Alternative Investment Funds

Access Elite Investment Strategies
for ₹1 Crore+ Investors

SEBI-regulated alternative investments beyond traditional stocks and mutual funds — designed for sophisticated investors seeking diversification, alpha generation, and access to private market opportunities. India's AIF industry has grown to 4.1% of GDP in FY 2025.

Min. ₹1 CroreSEBI AIF Regulations 2012Pre-IPO & PE AccessPass-Through Taxation
₹1Cr
Minimum Investment
3
AIF Categories
15-25%
Historical IRR Cat I & II
0.3-0.5
Correlation vs Nifty
4.1%
India AIF Industry (% of GDP)
Understanding AIF

What is an Alternative Investment Fund?

An Alternative Investment Fund (AIF) is a privately pooled investment vehicle regulated by SEBI that collects capital from sophisticated investors to invest according to a defined policy beyond conventional asset classes like stocks and bonds.

AIFs can access pre-IPO companies, venture capital, private equity, hedge fund strategies, distressed debt, and structured credit — opportunities completely unavailable through mutual funds due to regulatory restrictions.

📌 Regulatory Framework: Governed by SEBI (AIF) Regulations 2012, last amended November 2025 with introduction of Accredited Investors Only Funds. Regular SEBI compliance and disclosure norms apply.

Why UHNIs Allocate to AIFs

  • Access to pre-IPO and unlisted companies before exchange listing
  • Venture capital access from Series A to Series D funding rounds
  • Long-short strategies generating returns in rising AND falling markets
  • Distressed debt acquired at significant discounts during restructuring
  • Pass-through taxation — no double taxation at fund level
  • Low correlation (0.3-0.5) vs. public market indices — true diversification
  • Historical IRRs of 15-25% over 5-10 year periods (Cat I & II)
The Three Categories

AIF Category I, II & III Explained

Category I

Social Impact & Infrastructure

Investments with positive economic or social spillover effects. Receives SEBI concessions and government incentives for investing in areas deemed socially desirable.

Venture Capital Funds — early-stage startups
SME Funds — growth-stage businesses
Social Venture Funds — social enterprises
Infrastructure Funds — roads, ports, utilities
Angel Funds — seed-stage companies (min ₹25L)

Typical Return Profile: 15-25% IRR over 7-10 years. High illiquidity premium.

Category II

Private Equity & Debt

No specific incentives or concessions from SEBI. Does not use leverage beyond permitted limits. Most common AIF category for HNI investors seeking private market exposure.

Private Equity Funds — unlisted mid-market companies
Debt Funds — structured credit, corporate bonds
Real Estate Funds — commercial property, REITs
Fund of Funds — diversified across multiple AIFs
Distressed Asset Funds — turnaround opportunities

Typical Return Profile: 12-20% IRR. 3-5 year lock-in. Capital protection features in some strategies.

Category III

Hedge Fund Strategies

Employs diverse or complex trading strategies, including derivatives, leverage, and arbitrage. Can generate returns in both rising and falling markets. Suitable for sophisticated investors only.

Long-Short Equity — buy undervalued, short overvalued
Market Neutral — zero beta strategies
Arbitrage Funds — exploit price inefficiencies
Global Macro — macro-economic driven trades
Quantitative Strategies — algorithm-driven

Typical Return Profile: 15-30%+ target. Higher risk. NAV-based liquidity varies by fund.

Suitability Check

Is AIF Right For You?

AIFs require minimum ₹1 Crore investment and 3-5 year lock-in. Answer 8 questions to discover which AIF category suits your profile.

📋 Complete the Risk Profiling assessment to receive personalised AIF category recommendations — Category I (high illiquidity, max IRR), Category II (balanced PE/debt), or Category III (hedge strategies).

Know Yourself First

AIF Suitability Profile Assessment

This assessment determines which AIF category is right for you based on your financial capacity, liquidity needs, and risk tolerance.

Your Personal Risk Profile

8 questions. Honest answers. Personalised strategy recommendation tailored to PMS selection.

Financial Capacity
Question 1 of 8
What percentage of your total investable assets (excluding home) would this PMS investment represent?
Less than 10% — I have significant other investments
10 pts
10-25% — substantial but diversified
8 pts
25-50% — a major allocation for me
5 pts
More than 50% — this will be my primary investment
2 pts
1 of 8 completed
AIF FAQs

Frequently Asked Questions

AIF Resources

Free AIF Research Downloads

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AIF Categories I, II & III Guide

Deep dive into all three categories — taxation, liquidity, risk/return profiles, minimum investment, and how to choose the right category.

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100-Point Scorecard Explained

The framework we use to evaluate every AIF before recommending it — People, Process, Performance, Risk, Cost, and Transparency.

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PMS & AIF Complete Guide 2026

Comprehensive comparison of PMS vs AIF vs Mutual Funds — which is right for your goals, net worth, and investment horizon.

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NRI AIF Investment Guide

How NRIs invest in Indian AIFs — documentation, FEMA compliance, DTAA benefits, and repatriation process explained step by step.

Ready to Explore AIF Opportunities?

Schedule a free call. We'll identify which AIF category fits your profile and share our curated shortlist.