📌 What Is an Alternative Investment Fund (AIF)?
An Alternative Investment Fund (AIF) refers to a privately pooled investment vehicle that collects funds from sophisticated investors — both Indian and foreign — and invests in assets other than traditional equity, debt, or money market instruments.
These funds are typically less regulated , high-risk , and meant for high-net-worth individuals (HNIs) , institutional investors, and accredited investors who can bear the risks involved.
At Deccan Investment Centre , we help eligible investors understand AIFs and explore opportunities that align with their high-end investment goals and risk appetite.
🔁 Types of Alternative Investment Funds in India
SEBI has categorized Alternative Investment Funds into three main categories , based on their investment strategy and objectives:
1. Venture Capital Funds (VCFs): Invest in startups and early-stage companies.
2. Angel Funds: Pool investments from angel investors to fund new entrepreneurs.
3. Infrastructure Funds: Focus on infrastructure development projects.
4. Social Venture Funds: Support businesses aiming for social impact alongside financial returns.
1. Private Equity (PE) Funds: Invest in unlisted companies with strong growth potential.
2. Real Estate Funds: Focus on commercial and residential real estate projects.
3. Debt Funds (Non-Specific Sector): Invest in private debt instruments of established companies.
1. Hedge Funds: Use aggressive strategies including derivatives, arbitrage, and leverage.
2. Private Investment in Public Equity (PIPE): Investments in publicly traded companies through private placements.
3. Fund of Funds (Funds investing in other AIFs): Offers broader exposure across multiple alternative strategies.
⚖️ Important Conditions for AIF Investment
- Minimum Contribution : ₹1 crore per investor (unless exempted).
- KYC Compliance : All investors must complete KYC through SEBI-registered intermediaries.
- Investment Objective : AIFs are meant for long-term growth and are not for speculative or short-term trading.
For more information, Fix an appointment