Should you invest in SIFs? Experts explain who these funds are meant for
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New investment option
Specialised Investment Funds (SIFs), which offer differentiated strategies compared with plain-vanilla mutual funds, are gaining popularity among investors, with the industry reaching 95,000 folios as of July 31, 2026, as reported by ET Bureau.
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Equity MF vs equity long short SIF
While an equity mutual fund is primarily a long-only product, an equity long-short SIF can take both long and short positions. This ability to take short positions gives the SIF more flexibility to manage market cycles and potentially generate returns even when some stocks or sectors decline.
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Cash holding and derivative positions
While a typical equity fund is generally fully invested or holds a small portion in cash, an equity SIF can short up to 25% of its net assets using unhedged derivative positions.
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Top SIF strategies
Within equity SIFs, the strategies launched include the Equity Long-Short SIF, Ex Top 100 Long-Short SIF, and Sector Rotation Long-Short Fund.
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Minimum investment amount
Equity mutual funds typically allow SIPs from as little as Rs 500, with lump-sum investments starting at Rs 1,000–5,000. In contrast, SIFs require a minimum investment of Rs 10 lakh, which can be spread across schemes of the same fund house. Once this threshold is met, investors can start an SIP with a minimum monthly contribution of Rs 1,000.
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Who should opt for a SIF?
Wealth managers say equity SIFs are not suitable for first-time equity investors. They may complement existing portfolios for investors with substantial equity exposure who seek active market management, are comfortable with short selling and derivatives, and want an alternative to traditional equity mutual funds.
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Total SIF AUM
SIFs managed assets worth Rs 23,177 crore as of July 31, 2026. Of this, Rs 6,654 crore was managed across 19 long-short strategies, including 11 Equity Long-Short, seven Equity Ex Top 100 Long-Short and one Sector Rotation Long-Short strategy.