ALL ABOUT SIFs

Specialised Investment Funds (SIFs) are a new category of investment products introduced by SEBI in 2025. They were created to provide Indian investors with access to more sophisticated, flexible, and diversified strategies that go beyond the scope of traditional mutual funds.

While mutual funds primarily invest in equities, debt, or hybrid schemes with strict diversification limits, SIFs can operate with hedge-fund-style flexibility under SEBI’s regulatory framework. They are designed to bridge the gap between:

• Mutual Funds (too limited for advanced strategies)
• PMS & AIFs (too expensive and exclusive for most investors)
   

Think of SIFs as a regulated middle ground — advanced strategies, but with a lower ticket size than PMS and AIFs.

 SIFs stand out because of their unique structure and regulatory allowances.

 1. Minimum Investment Requirement 

• Investors need to commit at least ₹10 lakh. 
• This is far higher than mutual funds (₹500 SIP) but far lower than PMS (₹50 lakh) or AIFs (₹1 crore).

 2. Regulation by SEBI

• SIFs are tightly governed under SEBI’s rules.
• The framework ensures transparency, regular reporting, and investor protection 

 3. Investment Flexibility

• SIFs can invest in a broad universe of assets, including:
  • Equity (listed) 
  • Debt (corporate & government)
  • Commodities (like gold)
  • REITs and InvITs
• They can also deploy derivative strategies for hedging and long-short trades

 4. Risk Controls

• SIFs are allowed to take up to 25% unhedged short exposure- this cap ensures that while advanced strategies are permitted, the fund cannot become overly speculative.