SIF vs Mutual Funds vs AIFs: What Investors Need to Know

本站添加: 2026-05-31

[00:00:00]With SF you can have a nonlinear participation. You can have a better upside participation and a better downside protection. Hello and welcome.

[00:00:09]I'm in conversation with Gorik Sha responsible for managing the new SIF at Mir Asset. In the next 10 minutes you'll understand what specialized investment fund SIF is, what it can do, what is the promise and what not to expect. Sebi has created a new fund category in India called specialized investment fund or SIF. Uh most retail investors have never heard of them. It's it's a it's in its early stages of getting started.

[00:00:42]>> For someone starting fresh, what is the SIF? SF is a uh is a specialized investment fund which is a new category which CB has created where it has given more flexibility compared to your normal mutual funds. At the same time tax efficiency remains same as mutual fund. Your uh transparency cost advantage remains same as your mutual fund.

[00:01:08]>> So everything is a mutual fund. What is different?

[00:01:11]>> The difference is you get more flexibility.

[00:01:13]>> What?

[00:01:14]>> Okay. You can use derivatives you can be short till 25% uh >> okay short in >> so you can use more derative structures there are certain examples which is uh things which you cannot do in mutual fund necessarily it does not mean just increasing the risk in fact that is one perception with SF which has to be corrected that SF since dead risk will be used risk will be increased >> that's a perception okay but that's not going to be a true picture because your leverage is not allowed In SF >> Mhm.

[00:01:45]>> you have to have maximum 100% exposure.

[00:01:48]Even if you're doing 25% short, it has to come under the 100% ambit.

[00:01:53]>> That means you if you are 25% short, maximum long you would be 75%.

[00:01:57]>> Mhm.

[00:01:58]>> Okay. So that leverage is not there. So risk is always likely to be less than your normal mutual fund.

[00:02:05]>> Mhm.

[00:02:05]>> Use of derivatives does not mean increase the risk.

[00:02:08]>> Okay. Sebi created the FIF category to the fill the gap between uh mutual fund and AIF which is a much larger ticket.

[00:02:16]>> In plain English what was the gap?

[00:02:19]>> This is being made available to mass affluent segment earlier that access was not there to the strategies.

[00:02:25]>> We have been doing this kind of trading in uh prop books in hedge funds then AF opened up in 2015 onwards. We have been doing this kind of it was never available to the >> uh mass effence segment >> in the structured format.

[00:02:39]>> It's a structured not even in structured format. Then you had to go into very very uh unstructured format and then you do not have any control on the risk.

[00:02:49]There's no transparency cost >> and normally it will be offered by the broker.

[00:02:53]>> Yes. Yes.

[00:02:54]>> Okay. And that was I think that is one of the reasons why CB opened up for the uh people to get it more structured way which is more transparent >> and more cost efficient. So an investor in India now has four rappers to choose from >> mutual funds, PMS, AI and SIF. Now >> if the user has to remember one in sentence about each what is that?

[00:03:22]Mutual funds, mutual funds, mutual fund mutual fund sutibility which is little bit more massent because I think SE do not want it to be the people who cannot take that risk.

[00:03:40]>> Okay, having said that there it is everyone is bit cautious about it. AF and PMS tax is a big issue. SIF can take up to 25% unhedged short exposure in derivatives.

[00:03:52]What does this allow a fund manager to do that a mutual fund cannot? So two things it can allow us to do. First thing is obviously it can be used to hedge your positions or reduce your risk systematically. That is one thing.

[00:04:07]Second thing it allows us is more flexibility to use the structures different structures like your caller strategy. uh there could be different structures around it like strategle.

[00:04:17]You'll hear 10 types of different strategies around it which is possible within this not in mutual fund.

[00:04:24]>> Mhm.

[00:04:25]>> It will give you better risk adjusted returns. There'll be different type of SF within SF also there are seven categories. Some will be more aggressive, some will be more conservative. Okay. So conservative funds if you have a requirement of a conservative fund within your portfolio then you can choose conservative funds and compared to current existing options available in mutual fund where they're linear risk product.

[00:04:49]>> Okay.

[00:04:49]>> Okay. There's certain amount of risk you take let's say some funds which are conservative they would take 10 20%.

[00:04:56]Exposure in the market that means market goes up 20%. They go up 20%. market goes down 20% they will also go down 20% of the market >> so participation is linear >> with SF you can have a nonlinear participation >> okay >> you can have a better upside participation and a better downside protection >> okay >> so market goes up it goes up >> you can structure those >> structure those kind of risk it could be done conservatively it could be done aggressively >> on the same 10% pre-ax return SIF leaves an investor with 8.5% post tax and category AIF leaves her with you know something like 6.1%.

[00:05:35]Walk us through this 2.4% point gap you know on via how does it you know the taxation bit.

[00:05:40]>> So actually that number is much higher that little bit higher than that that's a pure maths okay >> on SF if it's an equity SF then you pay a equity taxation like a mutual fund it's it works exactly like your mutual fund >> beyond 12 months in equity mutual fund you pay 12.5% tax plus searches make you 15%. M >> so in that case this become 8.5 >> right so that is how the 8.5 works with the AF AF the taxation is different taxation on the fund level >> okay >> okay and that generally the fund would be of higher ticket size so their returns will be in upwards of ICR and on that is upward of ICR then there are search charges applied >> and that maximum come out to be 39%.

[00:06:24]>> Okay.

[00:06:24]>> So they'll be paying 39% and >> the differential tax rate itself.

[00:06:28]>> Yes. And then there's other part to it also because it's a fund level taxation.

[00:06:32]It has to be paid every year.

[00:06:35]>> Okay. It has to be paid every year on a per transaction basis.

[00:06:38]>> No, not per >> no accounted for on >> accounted for on a per transaction basis.

[00:06:43]>> So every year it will be paid for >> and that also creates a drag on your returns.

[00:06:49]>> So overall >> so you have to pay the advanced taxes every quarter it has to be accounted for.

[00:06:54]>> Okay. Assuming that I have a 5 cr rupee equity portfolio of which 20% is in fixed income.

[00:07:00]>> Yeah.

[00:07:00]>> As my rebalancing. It's a still a long only portfolio. I'm just taking a hypothetical.

[00:07:04]>> So it could be a better exposure against the >> So how much money should be there in SIF?

[00:07:10]>> You can start off with conservatively allocate some part of that portfolio.

[00:07:15]>> Which of which kind of SF?

[00:07:16]>> It's a cons. So now SFS are going to be of >> three kinds. They're going to be of three kinds. one is your uh conservative, one is going to be aggressive and one is going to be long only kind of strategies. Okay. So on the >> and fixed income is not taking off or as significantly.

[00:07:33]>> No fixed income is uh if they come also there will be more of a credit and debt fund because the rule is that you need to use the index futures >> or listed futures >> to short it.

[00:07:45]>> Yeah.

[00:07:45]>> And on fixed income side listed futures are not liquid.

[00:07:48]>> So it's going to exist.

[00:07:50]>> Yeah. they don't exist >> underlying doesn't exist.

[00:07:52]>> Yeah. So that's why it is the case.

[00:07:55]>> So on the conservative part portfolio as you said FD is there you have to start using because there significant uh return and uh advantage is possible in this fund >> besides tax efficiency >> besides tax efficiency is obviously there >> uh apart from even arbitra there's more flexibility available in this fund. So it has a better overall yield possibility.

[00:08:19]So that is a good for the conservative fund that is a good segment.

[00:08:23]>> What is one thing that investors are expecting from SIF which is it is unlikely to meet >> returns.

[00:08:29]>> Returns okay they are expecting some >> yeah means >> exaggerated return.

[00:08:33]>> Exact as I said it's a derives are going to be used to reduce the risk.

[00:08:38]>> When you mean that it also means that returns are not going to be over and above what you are getting in a normal long only mutual funds. Unlikely to I will not say it is not going to happen.

[00:08:48]I am saying unlikely to happen. You are getting started with this platinum hybrid longshot fund but uh what is your medium-term uh road map for launching these SIS?

[00:08:59]>> So we will come so we will come out with different strategies. The criteria for us is there needs to be a distinct advantage in every product we bring out.

[00:09:10]>> Mhm.

[00:09:10]>> We don't want to come out with a meto product.

[00:09:12]>> Okay. Okay. So we'll come out with the products we are creating working on the strategies where we can against the existing products available in the market if there's a distinct advantage either on the risk side or on the return side.

[00:09:24]>> Okay.

[00:09:25]>> Okay. We will over a period of time come out with different strategies.

[00:09:29]>> This platinum hybrid longshot fund. What is your pitch? What should investors expect from this?

[00:09:34]>> See our strategy is a strategy which has a capped upside and a cap downside.

[00:09:39]>> Okay. As I said, it's a conservative fund which is supposed to generate certain returns over a period of time, stable returns.

[00:09:46]>> Okay. Which is higher than the ones which is available in the market.

[00:09:49]>> Mhm.

[00:09:50]>> Uh products. So uh we are going to be focused on the risk. I know for sure any forget about my product any kind of product which is conservative which is a capped upside if it does not cap the downside >> then it's a loser game.

[00:10:06]>> It's a loser. That risk may come uh this month, next month, five years down the line, but that will come.

[00:10:13]>> So to begin with, you're starting on a uh that you're tiptoeing the market with this strate.

[00:10:19]>> Yeah. So it's a new product, new category. Investor is going to come, he's also going to experiment with it.

[00:10:24]He's going to table the hand. If he's not going to get a good experience out of this, >> then he's going to put off. In your own back testing for this fund which is platinum hybrid longshot fund what has been the best case and worst case scenarios in terms of returns the max draw down has been 2.7%.

[00:10:43]Max single month loss has been around 1.7%.

[00:10:47]Okay. Okay. And the best is around 3 3.5%.

[00:10:51]So this strategy will work in a steady upward uh market in upward trending market. it has potential to do in a back testing around 16 17% also it has seen.

[00:11:01]>> Mhm.

[00:11:02]>> And the worst rolling 12 month in the back testing it's seeing is 2% something like that.

[00:11:06]>> Okay.

[00:11:07]>> Okay. But as you increase your time horizon that number volatility goes down significantly. Then your number narrows between 5.5% and 13%.

[00:11:15]>> Okay. So time changes everything.

[00:11:18]>> Ultimately depends on the underlying market conditions. As the time increases the market condition stabilizes and we get more stable returns. Okay, so we have talked about a new fund category the SIS. Let's pull back and what has 19 years in the market actually taught you that is what we'll talk now. Darin here is at fittest survives but that is not