Understanding Alternative Investment Funds
Explainers on India's SEBI-regulated Alternative Investment Funds: what they are, how the three categories differ, what it costs to invest, and why their performance cannot be compared the way portfolio management performance can.
- Accredited investors in India — the thresholds, and what accreditation actually gets you
SEBI's accredited investor framework sets three alternative tests for individuals: annual income of ₹2 crore, or net worth of ₹7.5 crore with ₹3.75 crore in financial assets, or ₹1 crore income plus ₹5 crore net worth. Body corporates need ₹50 crore net worth.
Checked against source on 24 August 2026
- AIF categories explained — Category I, II and III under the SEBI AIF Regulations
SEBI sorts every Alternative Investment Fund into three categories. What each one may invest in, how each is taxed, which must be close-ended, and how large each category actually is in SEBI's own latest quarterly figures.
Checked against source on 24 August 2026
- AIF fees and costs — what an Alternative Investment Fund actually charges
Management fee, setup cost, placement fee, carry above a hurdle, and the fund's own operating expenses. What SEBI regulates, what it does not, and the questions to ask before you commit.
Checked against source on 24 August 2026
- AIF minimum investment — ₹1 crore, and every exception to it
The minimum investment in an Indian AIF is ₹1 crore under Regulation 10(c). Employees and directors of the fund or its manager may invest ₹25 lakh. Large value funds require ₹25 crore per investor, cut from ₹70 crore on 18 November 2025.
Checked against source on 24 August 2026
- AIF risks — what can actually go wrong, and what SEBI registration does not protect you from
Illiquidity, blind-pool risk, concentration, capital calls you must meet, and the fact that no public source can verify a manager's track record. The risks of an Indian Alternative Investment Fund, stated plainly.
Checked against source on 24 August 2026
- AIF taxation in India — Section 224 of the Income-tax Act, 2025, and what it changed
Category I and II AIFs are 'investment funds' under Section 224 of the Income-tax Act, 2025: income other than business income is taxed in the investor's hands and keeps its character. Category III is outside the definition. The statutory position, cited to the Gazette.
Checked against source on 24 August 2026
- AIF vs mutual fund — what actually separates them
A mutual fund is a public offering with a low minimum, daily NAV and daily liquidity. An AIF is a private placement with a ₹1 crore minimum, capped at 1,000 investors per scheme, usually close-ended, free to hold unlisted assets, and with no public performance disclosure.
Checked against source on 24 August 2026
- AIF vs PMS — how Alternative Investment Funds and Portfolio Management Services differ
AIFs pool capital with a ₹1 crore minimum; PMS manages a separate account with a ₹50 lakh minimum. The difference that matters most is disclosure — PMS performance is publicly comparable and AIF performance is not.
Checked against source on 24 August 2026
- AIF vs SIF — how an Alternative Investment Fund differs from a Specialized Investment Fund
A SIF sits inside the mutual fund regulations with a ₹10 lakh minimum, a daily NAV and published performance. An AIF is a private placement at ₹1 crore with no public performance data at all. The gap that matters is disclosure, not strategy.
Checked against source on 24 August 2026
- GIFT City AIFs — why they are not SEBI AIFs, and what the rules actually are
A fund at GIFT IFSC is regulated by IFSCA under the IFSCA (Fund Management) Regulations, 2025, not by SEBI. The nearest equivalent of an AIF is a restricted scheme, with a USD 150,000 minimum per investor and a USD 3 million minimum corpus.
Checked against source on 24 August 2026
- How to choose an AIF — a diligence framework, and why there is no ranked list
There is no credible ranking of the best AIFs in India, because no public source publishes comparable performance. What to examine instead: category fit, the manager's verifiable record, fees in writing, lock-in and drawdown mechanics, and what the PPM must disclose.
Checked against source on 24 August 2026
- How to invest in an AIF — the process, end to end
What actually happens between deciding to invest in an Alternative Investment Fund and being a unit holder: eligibility, finding funds, the PPM, the contribution agreement, KYC, drawdowns and the direct plan. Information only — this site does not distribute funds.
Checked against source on 24 August 2026
- What is an AIF? Alternative Investment Funds in India, explained
An Alternative Investment Fund is a privately pooled investment vehicle registered with SEBI, with a Rs 1 crore minimum. What the three categories are, who can invest, and how AIFs differ from mutual funds.
Checked against source on 24 August 2026
- Why AIF returns are not comparable in India, and what performance data does exist
Category-level AIF performance is published by SEBI's mandated benchmarking agencies on a stated basis. Per-fund performance is not, because it lives in the private placement memorandum. This page sets out exactly where the line falls and why it is structural.
Checked against source on 25 August 2026