AIF

An Alternative Investment Fund (AIF) is a privately pooled investment vehicle that collects funds from sophisticated investors—both domestic and international—to invest in unconventional asset classes beyond traditional stocks, bonds, and cash.

Regulatory Framework

In India, AIFs are established as a trust, company, or Limited Liability Partnership (LLP) and are regulated by the Securities and Exchange Board of India (SEBI) under the SEBI (Alternative Investment Funds) Regulations, 2012.

Key Features & Structure

Minimum Investment: ₹1 crore for general investors; ₹25 lakh for employees, directors, or managers of the fund (Accredited Investors are exempt from the standard minimum requirement).
Fund Size & Limits: Minimum corpus per scheme is ₹20 crore (₹10 crore for Angel Funds). Each scheme can have a maximum of 1,000 investors (49 for Angel Funds).
Lock-in Period: Usually close-ended with a minimum lock-in period of 3 years.
Target Investors: High-Net-Worth Individuals (HNIs), Ultra HNIs, family offices, and institutional investors.

Categories of AIFs

SEBI classifies AIFs into three broad categories based on their target sectors and investment strategies.

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