The structure has some advantages but the strategy must be different to warrant the 'alternative' tag
With equity markets scaling all time highs, listed equity stocks are attracting an increasing number of investors. The latest managed equity portfolio product in the market are the long-only listed equity Category III Alternative Investment Funds (AIFs). AIFs are managed funds regulated by the Securities and Exchange Board of India (Sebi) and Category III AIF is the only one that can invest in listed securities, including equity. Unlike equity mutual funds and portfolio management services (PMS), it requires a significantly higher minimum investment of Rs1 crore, making it suitable only for high networth investors (HNIs). Also, AIFs can use leverage, or they can borrow to invest, which the other two products can't.