Alertnative Investment Funds
An Alternative Investment Fund, or AIF, is a confidentially pooled investment vehicle developed or incorporated in India that collects assets from expert investors, whether Indian or global, for investing in line with a defined investment policy for the welfare of its investors. AIFs can be formed or incorporated as a corporation, trust, or other legal entity (including limited liability partnerships). The SEBI (Mutual Funds) Laws of 1996, the SEBI (Collective Investment Schemes) Laws of 1999, or any other Board regulations governing fund management do not apply to AIF.
Explore diverse investment opportunities beyond traditional markets. With expert advice and rigorous due diligence, we guide you towards high-potential avenues for growth and diversification. Elevate your investment strategy with us.
Features Of Alertnative Investment Funds
- Diverse investment options such as private equity, real estate, and hedge funds
- Pooled investment structure, allowing for economies of scale and reduced investment costs
- Active management by investment professionals
- Access to typically private and less accessible investment opportunities
- Regulated by the Securities and Exchange Board of India (SEBI)
Benefits Of Alertnative Investment Funds
- Diversification of investment portfolios, reducing overall risk
- Potential for higher returns compared to traditional investments
- Access to a wider range of investment opportunities, including private equity and real estate
- Professional management of investments, reducing the need for individual research and analysis
- Potential for tax benefits, depending on the type of AIF and the jurisdiction in which it is located
- It's important to note that investing in an AIF also carries risks, such as the possibility of loss of capital, illiquidity, and currency fluctuations. As with any investment, it is crucial to carefully research and understand the risks and benefits before making a decision.
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Alternative Investment Fund or AIF means any fund established or incorporated in India which is a privately pooled investment vehicle which collects funds from sophisticated investors, whether Indian or foreign, for investing it in accordance with a defined investment policy for the benefit of its investors.
The venture capital funds (VCF) registered under the repealed SEBI (Venture Capital Funds) Regulations, 1996 shall continue to be regulated by the said regulations until existing fund is wound up and no new fund or scheme shall be launched after that under the said regulations. However, the existing VCF may seek re-registration under SEBI (Alternative Investment Funds) Regulations, 2012 subject to approval of two-third of its investors by the value of their investment. For more information.
No scheme of an AIF (other than angel fund) shall have more than 1000 investors. (Please note that the provisions of the Companies Act, 1956 shall apply to the AIF if it is formed as a company). In case of an angel fund, no scheme shall have more than two hundred angel investors. However, an AIF cannot make invitation to the public at large to subscribe its units and can raise funds from the sophisticated investors only through private placement. Please refer to section 4(b), 10(f) and 19E(4) of SEBI (Alternative Investment Funds) Regulations, 2012 at the link for more information
Fund of Funds, in general, is an investment strategy of holding a portfolio of other investment funds rather than investing directly in stocks, bonds or other securities. In the context of Alternative Investment Funds (AIF), a Fund of Fund is an AIF which invest in another AIF. For more information.
Debt fund is an Alternative Investment Fund (AIF) which invests primarily in debt or debt securities of listed or unlisted investee companies according to the stated objectives of the Fund. These funds are registered under Category II.
Angel Fund is a sub-category of Venture Capital Fund under Category I Alternative Investment Fund that raises funds from angel investors and invests in accordance with the provisions of AIF Regulations.
Alternate Investment Funds (AIFs), which employ diverse or complex trading strategies and may employ leverage including through investment in listed or unlisted derivatives. Various types of funds such as hedge funds, PIPE Funds, etc. are registered as Category III AIFs.
Alternative Investment Funds (AIF) which do not fall in Category I and III and which do not undertake borrowing other than to meet day-to-day operational requirements and as permitted in the SEBI (Alternative Investment Funds) Regulations, 2012 are Category II AIF. Various types of funds such as real estate funds, private equity funds, funds for distressed assets, etc. are registered as Category II AIF.
Category I of the Alternative Investment Funds (AIF) include funds which invest in start-up, early stage ventures, social ventures, small & medium enterprises (SME), infrastructure or other sectors or areas which the Government or regulators consider as socially or economically desirable. It shall include venture capital funds, SME funds, social venture funds, infrastructure funds and such other AIF.
SEBI has a web-based centralized grievance redress system called SEBI Complaint Redress System (SCORES) where investors can lodge their complaints against AIFs.
