Specialised Investment Funds (SIF)
Meaning, benefits, taxation and how to invest — SEBI's new vehicle for investors who want more than mutual funds but aren't ready for PMS.
What is a Specialised Investment Fund?
A Specialised Investment Fund (SIF) is a flexible, professionally managed investment vehicle introduced by SEBI in 2024–25. It's tailored for investors who want more strategic flexibility than mutual funds but don't meet the ₹50 lakh minimum typically required for Portfolio Management Services (PMS).
India's investment ecosystem lacked a product for HNIs with ₹10–50 lakh to invest. SIFs bridge this gap by offering structured, flexible strategies at a reasonable entry point.
- More flexible than mutual funds
- More accessible than PMS or AIFs
- Minimum investment: ₹10 lakh (lower if accredited)
Key Features
Regulator
SEBI
Managed by
SEBI-registered Asset Management Companies (AMCs)
Minimum Investment
₹10 lakh (across all SIFs of a fund house, per PAN)
Investment Strategies
Equity long/short, debt strategies, hybrids
Liquidity
Limited — redemptions based on predefined windows
Reporting Frequency
Quarterly or semi-annual
Taxation
STCG 20% • LTCG 12.5% (no indexation)
Where SIFs Fit In
SEBI-regulated products compared by entry point and flexibility.
| Product | Min. Investment | Flexibility | Target Investor |
|---|---|---|---|
| Mutual Funds | ₹100–₹500 | Low | Retail Investors |
| SIFs | ₹10 lakh | Moderate–High | HNIs, Professionals |
| PMS | ₹50 lakh | Very High | Ultra-HNIs |
| AIFs | ₹1 crore | Very High | Institutions, Large HNIs |
Minimum Investment
- ₹10 lakh per PAN across all SIFs within an AMC.
- Not scheme-specific — applies at the AMC level.
- If your total investment drops below ₹10 lakh due to redemptions, you must fully exit.
Accredited Investor Exemption
You're exempt from the ₹10 lakh rule if you meet either:
- Annual income ≥ ₹2 crore (last 2 years), or
- Net worth ≥ ₹7.5 crore (excluding primary residence)
SIF vs Mutual Funds
| Feature | SIF | Mutual Fund |
|---|---|---|
| Regulator | SEBI | SEBI |
| Minimum Investment | ₹10 lakh | ₹100–₹500 |
| Investor Profile | HNIs, Professionals, Accredited Investors | Retail, HNIs, Everyone |
| Strategy Flexibility | Very High (credit, hedge, thematic, hybrid) | Low to Moderate |
| Liquidity | Limited (interval-based) | High (daily redemptions) |
| Transparency | Moderate (quarterly/semi-annual reports) | High (monthly disclosures) |
| Risk Profile | Medium to High | Low to High |
| Taxation | 20% STCG / 12.5% LTCG | Depends on type and holding period |
SIF vs PMS vs AIF
| Feature | SIF | PMS | AIF |
|---|---|---|---|
| Regulator | SEBI | SEBI | SEBI |
| Minimum Investment | ₹10 lakh | ₹50 lakh | ₹1 crore |
| Ownership Format | Pooled fund units | Direct stock ownership | Pooled fund units |
| Strategy Flexibility | Moderate–High | Very High | Very High |
| Liquidity | Limited (scheduled windows) | Very limited (custom exits) | Mostly closed-end; long lock-ins |
| Taxation | Fund-level (no indexation) | Investor-level capital gains | Category-dependent (pass-through for I/II) |
| Transparency | Moderate | High (stock-level reporting) | Low–Moderate |
| Best Suited For | HNIs with ₹10–50 lakh | Ultra-HNIs seeking control | Institutions, long-term HNIs |
Where Do SIFs Invest?
SEBI allows SIFs to follow one strategy per fund, within these three broad categories.
1. Equity-Oriented Strategies
- Equity Long Short Fund — 80% in equities; up to 25% short via derivatives
- Ex-Top 100 Long Short Fund — focused on mid/small-cap; up to 25% short
- Sector Rotation Fund — 80% in 4 sectors max; 25% sector short allowed
2. Debt-Oriented Strategies
- Debt Long Short Fund — active in debt with short positions via derivatives
- Sectoral Debt Fund — at least 2 debt sectors; 25% NAV short allowed
3. Hybrid Strategies
- Active Asset Allocator — mix of equity, debt, REITs, commodities; 25% short
- Hybrid Long Short Fund — 25% equity + 25% debt minimum; shorting allowed
Short exposure across all strategies is capped at 25% of NAV.
Taxation of SIFs
SIFs follow a mutual fund-like taxation model, but with flat rates.
| Capital Gain Type | Holding Period | Tax Rate |
|---|---|---|
| Short-Term (STCG) | Less than 12 months | 20% |
| Long-Term (LTCG) | More than 12 months | 12.5% (no indexation) |
Note: Taxation rules are indicative. Specific schemes within a SIF may be taxed differently.
Key Risks
Market Risk: May invest in volatile sectors or instruments
Liquidity Risk: No daily redemptions like mutual funds
Concentration Risk: Thematic strategies can lead to overexposure
Lower Transparency: Less frequent disclosures than mutual funds
Who Should Consider a SIF?
| Investor Profile | Why SIF |
|---|---|
| HNIs (₹10–50 lakh) | Want more control than MFs without a ₹50L+ PMS commitment |
| Accredited Investors | Seeking access to alternative assets and niche strategies |
| Doctors, Entrepreneurs | Growing wealth, looking for smart, structured investing options |
| Informed Investors | Understand risks, want flexibility and higher return potential |
Source: HDFC Bank, Moneycontrol, SEBI, Motilal Oswal. Prepared: Jan 2026.
Disclaimer: The above is prepared only as a guidance note for investors. Anyone investing into any financial product must confirm with their respective advisors or CAs. This note is only for education purposes. Do your own due diligence before investing in any financial product.
Explore related products: PMS, AIFs and Mutual Funds.
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