A regulator-built, structurally distinct investment category that lives between mutual funds and PMS. Here is the complete framework — what it is, what it isn't, who can launch one, and the seven strategies SEBI permits.
The short answer
A Specialized Investment Fund (SIF) is a SEBI-regulated mutual fund product for investors putting in at least ₹10 lakh. Unlike an ordinary mutual fund, it may take unhedged short positions of up to 25% of net assets through exchange-traded derivatives. The framework took effect on 1 April 2025; 37 strategies from 18 fund houses are live.
Sources: SEBI circular on the SIF framework, 27 Feb 2025; SEBI FAQs on SIFs, Part A, 22 Sep 2026; MeraSIF tracker, official AMFI NAVs
| Regulator | SEBI, under the SEBI (Mutual Funds) Regulations, 2026SEBI FAQs on SIFs, Part A, 22 Sep 2026 |
|---|---|
| In force since | 1 April 2025 (SEBI circular of 27 February 2025)SEBI circular on the SIF framework, 27 Feb 2025 |
| Minimum investment | ₹10 lakh per investor (PAN), across all strategies of one SIF; accredited investors are exemptSEBI circular on the SIF framework, 27 Feb 2025; SEBI FAQs on SIFs, Part A, 22 Sep 2026 |
| Short positions | Unhedged short exposure of up to 25% of net assets, through exchange-traded derivativesSEBI circular on the SIF framework, 27 Feb 2025 |
| Overall exposure | Gross exposure capped at 100% of net assets, so no leverageSEBI circular on the SIF framework, 27 Feb 2025 |
| Strategy types | 7: three equity, two debt and two hybrid; a SIF may run one strategy of each typeSEBI circular on the SIF framework, 27 Feb 2025 |
| Redemption | Equity: up to daily. Hybrid: at most twice a week. Debt: at most weekly. Notice period of up to 15 working daysSEBI circular on the SIF framework, 27 Feb 2025; SEBI FAQs on SIFs, Part A, 22 Sep 2026 |
| Risk band | Five levels, reviewed every monthSEBI circular on the SIF framework, 27 Feb 2025; SEBI FAQs on SIFs, Parts B and C, 22 Sep 2026 |
| Portfolio disclosure | At the end of every alternate month (May, July, September, November, January, March), within 10 daysSEBI circular on the SIF framework, 27 Feb 2025; SEBI FAQs on SIFs, Part A, 22 Sep 2026 |
| First allotment | qSIF Equity Long-Short, 7 October 2025MeraSIF tracker, official AMFI NAVs |
| Live today | 37 strategies from 18 fund housesMeraSIF tracker, official AMFI NAVs |
| Category size | ₹38,287 crore at the end of September 2026AMFI monthly data |
The SIF category was created by amending the SEBI (Mutual Funds) Regulations 1996 — specifically by inserting Chapter VI-C with effect from 16 December 2024. The operating framework was then issued through three SEBI circulars:
| Circular | Date | Purpose |
|---|---|---|
| SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/26 | 27 Feb 2025 | Master regulatory framework — eligibility, strategies, limits |
| SEBI/HO/IMD/...CIR/2025/49 | 9 Apr 2025 | Clarifications on minimum threshold; employee carve-outs |
| SEBI/HO/IMD/IMD-RAC/P/CIR/2025/54 | 11 Apr 2025 | Standardised application form and ISID disclosure formats |
The framework went live on 1 April 2025. Structurally, an SIF is "a scheme under the mutual fund trust" — so it inherits the same trustee, custodian, registrar & transfer agent, and auditor architecture as conventional mutual funds. The toolkit is what changes:
SEBI built the SIF category to bring back inside the regulated perimeter the investors with ₹10–50 lakh of liquid AUM who were drifting to unregulated F&O tipsters and "alpha clubs" — too rich for MFs, too poor for PMS or AIF.
An asset management company can launch an SIF only after meeting one of two eligibility tracks defined by SEBI. Both routes apply the same clean-record test (no SEBI Section 11 / 11B / 24 action in the last three years).
For established AMCs with proven scale and history.
For boutique AMCs with high-pedigree investment teams.
To prevent proliferation and confusion, SEBI permits exactly seven sub-strategies. Each AMC may launch only one strategy per category. Every strategy carries the same 25% unhedged-short cap, but the underlying allocation rules differ.
| # | Type | Sub-strategy | Minimum allocation | Short limit |
|---|---|---|---|---|
| 1 | Equity-Oriented | Equity Long-Short | ≥80% equity | ≤25% unhedged |
| 2 | Equity-Oriented | Equity Ex-Top 100 Long-Short | ≥65% in stocks ranked >100 by market cap | ≤25% unhedged |
| 3 | Equity-Oriented | Sector Rotation Long-Short | ≥80% across up to 4 sectors | ≤25% unhedged |
| 4 | Debt-Oriented | Debt Long-Short | ≥80% debt | ≤25% unhedged |
| 5 | Debt-Oriented | Sectoral Debt Long-Short | Sector-concentrated debt allocation | ≤25% unhedged |
| 6 | Hybrid | Active Asset Allocator Long-Short | Dynamic across equity / debt / commodity | ≤25% unhedged |
| 7 | Hybrid ★ | Hybrid Long-Short (~63% of category AUM, end-Sep 2026) | Defined equity-debt bands | ≤25% unhedged |
Beyond the 25% short cap, several other concentration and exposure limits apply.
25% of NAV — concentration limit on debt exposure to any single industry/sector.
Total of cash + derivatives + repo + credit default swaps cannot exceed 100% of net assets. This effectively caps leverage.
30 business days to deploy NFO proceeds into the target portfolio (extendable by another 30 days with Investment Committee approval).
Mandatory 5-level risk band disclosure in the Information Document and on each periodic statement.
Closed-ended and interval SIF strategies must list on NSE / BSE. Open-ended strategies operate via NAV redemption like a conventional MF.
How managers use these limits in practice: index hedges, short stock futures, cash-futures arbitrage and option spreads, and what each SIF held at its latest statement. How SIFs use derivatives →
| Minimum investment | ₹10 lakh aggregate per PAN per AMC across all SIF strategies of that AMC |
| Accredited investors | Exempt from the ₹10 lakh threshold; the fund house sets its own minimum |
| Below-threshold drift | Passive market loss → no action required. Active redemption breach → forced full redemption (no partial redemptions below the ₹10L floor) |
| Mutual fund holdings | Excluded from the threshold computation. ₹50 lakh in MF + ₹10 lakh in SIF is fully compliant |
| Rebalancing window | 30 days if floor is passively breached |
The ₹10 lakh aggregate minimum applies at the PAN level per AMC. So one investor can hold ₹10 lakh in ICICI Pru's iSIF and another ₹10 lakh in Edelweiss's Altiva SIF concurrently — but cannot split a ₹10 lakh ICICI Pru SIF allocation across two of ICICI Pru's strategies (since each AMC's SIF strategies aggregate together for the floor).
SEBI’s accredited-investor framework (introduced by the SEBI (Alternative Investment Funds) (Third Amendment) Regulations, 2021) also applies to SIFs: SEBI’s SIF circular of 27 February 2025 exempts accredited investors from the ₹10 lakh minimum; each fund house then sets its own minimum for them in the offer document (₹1 lakh at Platinum SIF and ₹25,000 at Diviniti SIF, for example). Accreditation is available to individuals, HUFs and family trusts who meet specified income, net-worth or financial-asset thresholds. As of May 2026, accreditation infrastructure is still maturing — most retail investors will use the standard ₹10 lakh route.
SIF strategies offer flexibility on both fund structure (open / closed / interval) and redemption frequency. Here is what you'll see across the live universe.
Continuous subscription and redemption. Daily, weekly, or monthly redemption frequency permitted. Most live SIFs are open-ended hybrids.
Subscription / redemption windows on specified dates. Mandatory listing on NSE/BSE between intervals provides secondary-market liquidity.
Fixed maturity. Listed on NSE/BSE at NFO close. Investors exit by selling units on the exchange or at maturity.
Misconceptions about SIF have spread quickly since the category launched. Here is what to be clear about:
The 25% unhedged-short cap is a real structural ceiling. SIF cannot run net-short, cannot borrow to leverage long, and cannot use complex over-the-counter derivatives. A true global hedge fund is closer to AIF Cat-III in vehicle structure.
The ₹10 lakh aggregate minimum makes SIF fundamentally a lump-sum instrument. There is no "SIF SIP" at retail scale. After the first ₹10 lakh deployment, AMCs may permit additional lump-sum top-ups (typically ₹1 lakh+).
SIF taxation tracks the underlying-asset taxation (equity / hybrid / debt) — same as a mutual fund of the equivalent type. The "tax advantage" is relative to PMS / AIF Cat-III, not relative to mutual funds.
Like every market-linked investment, SIF NAVs fluctuate with the underlying portfolio. The 25% short capability provides hedging optionality — not guaranteed downside protection. Verify drawdown experience for any SIF before allocating.
The ₹10 lakh floor + 15-day notice period + investment objective (3+ year horizon for most strategies) make SIF unsuitable for emergency liquidity. Maintain separate liquid / short-debt allocations for that bucket.
Checked against SEBI’s FAQs on Specialized Investment Funds (22 September 2026) and its SIF circulars on 4 November 2026. Counts and totals come from our tracker and AMFI’s monthly report, and update when they change. To cite: Mera SIF, “SIF FAQs”, https://www.merasif.com/faq.html.
A Specialized Investment Fund (SIF) is a mutual fund product, regulated by SEBI, that may use strategies regular mutual funds cannot, including limited unhedged short positions through derivatives. SEBI describes it as bridging the gap between regular mutual fund schemes and Portfolio Management Services (PMS). Each SIF strategy is run by a mutual fund under a separate SIF brand.
Source: SEBI, FAQs for Specialized Investment Funds, Part A: investors (22 Sep 2026); SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025)
SEBI regulates SIFs under the SEBI (Mutual Funds) Regulations, 2026. The framework was first set out in SEBI's circular of 27 February 2025, which took effect on 1 April 2025, and now sits in clause 21 of SEBI's Master Circular for Mutual Funds.
Source: SEBI, FAQs for Specialized Investment Funds, Part A: investors (22 Sep 2026); SEBI, FAQs for Specialized Investment Funds, Parts B and C (22 Sep 2026); SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025)
The SIF framework took effect on 1 April 2025, and the first strategy to allot units was qSIF Equity Long-Short, on 7 October 2025. Launches have continued since: 37 strategies from 18 fund houses are live today.
Source: SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025); MeraSIF fund tracker, official AMFI NAVs
37 SIF strategies from 18 fund houses are live on our tracker, which follows AMFI's daily NAV feed. AMFI's monthly report for September 2026 counted 34 schemes; strategies launched after that month appear in the next report.
Source: MeraSIF fund tracker, official AMFI NAVs; AMFI monthly SIF report
A SIF is a mutual fund product with three differences: a ₹10 lakh minimum per investor (PAN) across the SIF, permission to take unhedged short positions of up to 25% of net assets through exchange-traded derivatives, and its own set of strategy categories. It keeps mutual fund safeguards such as trustees, daily NAV and SEBI-format disclosure, but carries relatively higher risk.
Source: SEBI, FAQs for Specialized Investment Funds, Part A: investors (22 Sep 2026); SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025)
In a SIF you own units of a pooled strategy; in a PMS the securities are held in your own account and managed for you. A SIF's minimum is ₹10 lakh, a PMS's ₹50 lakh. A SIF is taxed like a mutual fund, mostly when you redeem, while PMS gains are taxed in your hands each time the manager sells.
Source: SEBI, FAQs for Specialized Investment Funds, Part A: investors (22 Sep 2026); SEBI (Portfolio Managers) Regulations, 2020: minimum investment ₹50 lakh
No. A SIF is a mutual fund product with statutory limits: unhedged short exposure of at most 25% of net assets, and total gross exposure across all holdings and derivatives of at most 100% of net assets, which rules out leverage. Hedge-fund-like strategies in India sit in Category III AIFs, which have a ₹1 crore minimum and different rules.
Source: SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025); SEBI circular, Clarification on the SIF framework (9 Apr 2025); SEBI (Alternative Investment Funds) Regulations, 2012: minimum investment ₹1 crore
Seven. Three equity types (Equity Long-Short, Equity Ex-Top 100 Long-Short, Sector Rotation Long-Short), two debt types (Debt Long-Short, Sectoral Debt Long-Short) and two hybrid types (Active Asset Allocator Long-Short, Hybrid Long-Short). No debt strategy is live yet.
Source: SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025); MeraSIF fund tracker, official AMFI NAVs
It means the strategy can position for prices to fall as well as rise. Besides buying securities (going long), it may take short positions through exchange-traded derivatives, with unhedged short exposure capped at 25% of net assets. Short positions that hedge existing holdings are allowed in addition.
Source: SEBI circular, Regulatory framework for Specialized Investment Funds (27 Feb 2025); SEBI, FAQs for Specialized Investment Funds, Parts B and C (22 Sep 2026)