Investment vehicles beyond typical stocks and bonds are alternative investment funds, alternative asset funds, or simply alternatives. Investors have access to various non-traditional assets through these funds, including commodities, private equity, hedge funds, and real estate. Investor interest in alternative investment funds has increased for several reasons. First off, diversification is made possible by alternative investment funds. A well-diversified portfolio can aid in reducing risk and possibly increase profits. Investors can deploy their money to various asset classes through alternative investment funds, some of which may have minimal or even negative correlations with traditional markets. Alternative investment funds, on the other hand, allow investors to allocate their capital to different asset classes that may have low or even negative correlations with traditional markets.
CATEGORIES OF ALTERNATIVE INVESTMENT FUNDS:
PROCESS OF LISTING AIF:
STEP 1:AIF approaches BSE for seeking In-principle Approval for Listing and Trading of Units.
STEP 2: Upon receipt of In-principle approval from BSE, AIF approaches SEBI for seeking approval.
STEP 3: Upon receipt of approval from SEBI, AIF approaches BSE for listing and further trade.
CONCLUSION: Investors are looking for new strategies to diversify their portfolios and generate strong returns in the quickly changing financial world. Alternative investment funds (AIFs), which offer access to areas outside of traditional assets including real estate, commodities, private equity, hedge funds, and are one route that is gaining a lot of traction. AIFs, which can be divided into three kinds, accommodate various risk profiles. They support portfolio diversification, which is essential for reducing risk and maximising rewards while balancing market volatility. Capital can be allocated through these investment vehicles to asset classes that have separate correlations to traditional markets, resulting in more thorough risk management. AIFs are essential in changing investment strategies and promoting innovation in the financial sector by enhancing market liquidity and efficiency.