Specialised Investment Funds are gaining significant traction in India, with assets under management reaching Rs 38,287 crore by September 2026. These funds bridge the gap between conventional mutual funds and complex hedge fund strategies.
How Specialised Investment Funds Operate
Bhautik Ambani, CEO of AlphaGrep Mutual Fund, explains that these instruments differ from traditional mutual funds through specific regulatory allowances. Investors must evaluate several key operational details before committing capital.
Key operational features of Specialised Investment Funds include:
Minimum investment requirement of Rs 10 lakh.
Allowance for naked short positions of up to 25 per cent.
Governance structure providing comfort compared to Portfolio Management Services or Alternative Investment Funds.
Evaluating Risk and Fund Manager Track Records
The growth in these funds is driven by hybrid strategies accounting for nearly 69 per cent of their assets. Ambani emphasizes that investors should view these as arbitrage-plus risk products requiring careful evaluation.
Investors should review the following factors:
The specific experience and track record of the fund manager in managing derivative strategies.
The net exposure of the fund to determine its overall portfolio fit.
The distinct derivative strategies employed by the management team.