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PMS /AIF

Alternative Investment Fund (AIF) is a special investment category that differs from conventional investment instruments. It is a privately pooled fund. Generally, institutions, HNIs & Ultra HNIs invest in AIF.

These investment vehicles adhere to the SEBI (Alternative Investment Funds) Regulations, 2012. AIFs can be formed as a company, Limited Liability Partnership (LLP), trust, etc.

Who Can Invest in an AIF?

Investors willing to diversify their portfolio can invest in AIFs if they meet the following eligibility criteria:

  • Resident Indians, NRIs, and foreign nationals can invest in these funds
  • The minimum investment limit is Rs. 1 crore for investors.
  • AIFs come with a minimum lock-in period of three years or it can be more depend upon AMC.
  • The number of investors in every scheme is restricted to 1000, except angel funds, where the number of investors goes up to 49.

Benefits of Investing in AIFs

  • High Return Potential
  • Low Volatility
  • Diversification

Objectives of Portfolio Management

The fundamental objective of portfolio management is to help select best investment options as per one’s income, age, time horizon and risk appetite
Some of the core objectives of portfolio management are as follows:-

  • Capital appreciation
  • Maximising returns on investment
  • To improve the overall proficiency of the portfolio
  • Risk optimisation
  • Allocating resources optimally
  • Ensuring flexibility of portfolio
  • Protecting earnings against market risks

Nonetheless, to make the most of portfolio management, investors should opt for a management type that suits their investment pattern.

Who Should Opt for Portfolio Management?

The following should consider portfolio management –

  • Investors who intend to invest across different investment avenues like bonds, stocks, funds, commodities, etc. but do not possess enough knowledge about the entire process.
  • Those who have limited knowledge about the investment market.
  • Investors who do not know how market forces influence returns on investment.
  • Investors who do not have enough time to track their investments or rebalance their investment portfolio

To make the most of the managerial process, individuals must put into practice strategies that match the investor’s financial plan and prospect.