Understanding the risks in AIFs and PMS investments
SummaryThe liquidity risk in AIFs is so grave that even some venture capital funds have been unable to sell their investments due to the ongoing startup funding winter, according to financial market experts.
Investing in alternative investment funds (AIFs) can be a risky affair. Some investors learnt it the hard way when ICICI Prudential closed its real estate AIF recently. Six underlying investments remained stuck with the fund even after the expiry of its term in March. This implied that the payouts by the AIF would be delayed.