Markets regulator Securities and Exchange Board of India (Sebi) has introduced guidelines for a Specialised Investment Fund (SIF), a bridge product between mutual funds and portfolio management services.
WHAT IS THIS SPECIALISED INVESTMENT FUND?
The Specialised Investment Fund is a new investment product introduced by Sebi. The regulator believes that over the years a gap has emerged between mutual funds (MFs) and portfolio management schemes (PMS) in terms of portfolio flexibility, thereby creating an opportunity for a new investment product. To bridge this gap, the SEBI (Mutual Funds) Regulations, 1996, have been amended to introduce the broad regulatory framework for this new product. This framework has been introduced through amendments to the SEBI (Mutual Funds) Regulations, 1996, and will be effective from April 1. Mutual fund industry body AMFI is expected to bring out additional operational guidelines before March 31.
WHAT IS THE MINIMUM INVESTMENT AMOUNT NEEDED FOR A SIF?
The minimum investment in a SIF will be Rs 10 lakh per investor. The fund house can offer a systematic investment plan (SIP) and systematic withdrawal plan (SWP), but it must comply with the minimum threshold amount. The SIF can be open-ended, closed-ended, or interval-based.
WHAT KIND OF INVESTMENT STRATEGIES CAN A SIF OFFER?
The regulator has allowed SIFs to offer three categories of investment strategies. The first is equity-oriented strategies such as equity long-short funds, equity ex-top 100 long-short funds and sector rotation long short funds. The second is debt-oriented strategies such as debt long-short funds and sectoral debt long-short funds. The third category is hybrid strategies like active asset allocator long-short funds and hybrid long-short funds. The current framework allows only one strategy per category per SIF.
WHAT ARE THE ELIGIBILITY CRITERIA FOR SIFs?
The regulator has outlined two routes through which an AMC can establish an SIF. As per the first rule, the fund house must be in operation for three years at least and have average assets under management (AUM) of Rs 10,000 crore immediately preceding the three years. The alternative route is that the AMC must appoint a chief investment officer (CIO) with at least 10 years of experience and managing assets of Rs 5,000 crore or more. The AMC must also have an additional fund manager and have at least three years of experience managing an AUM of Rs 500 crore.
WHAT IS THIS SPECIALISED INVESTMENT FUND?
The Specialised Investment Fund is a new investment product introduced by Sebi. The regulator believes that over the years a gap has emerged between mutual funds (MFs) and portfolio management schemes (PMS) in terms of portfolio flexibility, thereby creating an opportunity for a new investment product. To bridge this gap, the SEBI (Mutual Funds) Regulations, 1996, have been amended to introduce the broad regulatory framework for this new product. This framework has been introduced through amendments to the SEBI (Mutual Funds) Regulations, 1996, and will be effective from April 1. Mutual fund industry body AMFI is expected to bring out additional operational guidelines before March 31.
WHAT IS THE MINIMUM INVESTMENT AMOUNT NEEDED FOR A SIF?
Best MF to invest
Looking for the best mutual funds to invest? Here are our recommendations.
WHAT KIND OF INVESTMENT STRATEGIES CAN A SIF OFFER?
The regulator has allowed SIFs to offer three categories of investment strategies. The first is equity-oriented strategies such as equity long-short funds, equity ex-top 100 long-short funds and sector rotation long short funds. The second is debt-oriented strategies such as debt long-short funds and sectoral debt long-short funds. The third category is hybrid strategies like active asset allocator long-short funds and hybrid long-short funds. The current framework allows only one strategy per category per SIF.
WHAT ARE THE ELIGIBILITY CRITERIA FOR SIFs?
The regulator has outlined two routes through which an AMC can establish an SIF. As per the first rule, the fund house must be in operation for three years at least and have average assets under management (AUM) of Rs 10,000 crore immediately preceding the three years. The alternative route is that the AMC must appoint a chief investment officer (CIO) with at least 10 years of experience and managing assets of Rs 5,000 crore or more. The AMC must also have an additional fund manager and have at least three years of experience managing an AUM of Rs 500 crore.
