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SIFs Stick to Equity, Ignore Debt Markets
8 Feb
Summary
- Specialized Investment Funds focus on equity, avoiding debt strategies.
- Ten SIFs launched, with nine more in the pipeline as of early 2026.
- SIFs offer a middle ground between mutual funds and PMS, with ₹10 lakh minimum.
As of early 2026, India's Specialized Investment Funds (SIFs) have largely concentrated on equity and hybrid long-short strategies since their launch nearly a year ago. Fund houses have introduced ten SIFs, with nine more products in the pipeline, primarily focusing on equity long-short, equity ex-top 100 long-short, and hybrid long-short categories.
SIFs require a minimum investment of ₹10 lakh, positioning them between mutual funds and portfolio management services. Industry executives suggest that investor demand and practical considerations such as risk, taxation, and market infrastructure have led to this clustering around equity-oriented products.
While equity strategies are favored, sector rotation long-short funds face challenges due to high trading costs and risks associated with timing sector shifts. Debt-oriented SIFs also encounter hurdles related to taxation and the need for developing hedging tools, making them less appealing for high-net-worth investors currently.
