Portfolio managers have grown as appropriate ₹Since then, 4.26 billion million. Even mutual fund investors pass categories such as balancing advantageous funds (e.g. ₹2.9 billion assets under management) and multi-asset funds ( ₹AUM’s Rs 433 crore).
The Securities and Exchange Commission of India recently notified new asset class: Professional Investment Fund (SIF), which has the minimum investment ₹1 million, sitting between mutual funds and portfolio management services. My optimism about this new asset class is the same as when I created my first AIF in 2012.
Both are existing joint funds ₹Starting from April 1, SIF’s 100 million AUM and three years of track record and professional investment managers can be launched from April 1. So here are some crystal balls gazing at potential products and what they can do for your portfolio.
My main idea is to return to the structured product via the SIF route. These funds can provide regular subscriptions and redemptions, capital protection, and provide 30-70% nifty upside space on dates.
Psychological comfort
The structured product SIF attracts Indian investors who want to have the psychological comfort of capital preservation and the benefits of equity rise. These funds will be taxed – like stock mutual funds, they will not have credit risk for loans to NBFC and can provide daily liquidity to investors through unit listing, even if the fund itself will only be open regularly.
Midha has been an investor favorite since the pandemic. But the ongoing market corrections remind us that the path to wealth can be filled with painful potholes.
Equity Ex-Top 100-length SIF will allow fund managers to invest in medium-covers in the short term, and even purchase a large number of voting options to protect the capital in the neutralization of small cap melting.
India has always been the stock market. Just as fund managers have the opportunity to find stocks that outperform the market, the chances of finding stocks are equal.
Historically, stock fund managers can only buy underweight stocks within the range that appears in the benchmark. However, with long/short equity SIFs, managers can provide unitholders with stronger performance beyond performance by shortening negative perceptions about stocks and sectors.
The long/short concept goes beyond stocks and enters multi-asset and hybrid fields. SIF has the opportunity to create world-class absolute rate of return, which can bet on the price rise and fall of stocks, debts, commodities, Invits (Infrastructure Investment Trust) and REIT (Real Estate Investment Trust).
If someone can create a product that consistently provides low-grade returns with low volatility, then the sky is a limit on investors’ appetite! For emerging high net worth individuals, this product may compete with solutions above riskier fixed income, and even offer them a comparison to home loan EMI rates.
Likewise, multi-foundation arbitrage and special positioning products can provide compelling returns for low-risk investors who want to park their funds within a timeframe of more than one year.
Debt Fund
The debt category has also begun to innovate. SIF will be able to provide up to 20% of the centralized debt fund in a single issuer, while a single sector can provide up to 75%.
Under this system, debt funds investing in high-level NBFCs will be possible, and so will funds that buy Tata corporate bonds only. This is an important bridge for the development of Indian corporate bond market.
The debt SIF is also allowed to trade derivatives, which encourages institutional participation and development in the Indian interest rate futures and credit default swap markets. The debt SIF may generate negative durations, which means it gets when interest rates rise.
Funds like this are incredible diversifiers in investors’ portfolios, otherwise the fund would have only holdings that they gained from falling interest rates.
SIF benefits from strong governance oversight of mutual fund boards, strict risk management norms, professional fund management and the same taxes as conventional mutual funds. Advisors are required to improve their skills through the NISM (National Securities Market Research Institute) exam before distributing these products to clients. Good financial advice has never been more valuable.
As with all innovations, it is very important for investors to gradually build confidence and distribute SIFs. Recognized investors have great advantages ₹AMC is 1 million per time, so they can taste a variety of products from several fund houses.
Once the Fund House has established field records and combat strategies under tough market conditions, the SIF will transition from satellite to core allocation.
But at the same time, the new asset class offers investors many new opportunities to improve returns, diversify their risks and have greater certainty about their financial goals.
Nalin Moniz is CEO of Ion Asset Management
