- What are Specialised Investment Funds (SIFs)?
- Quant's Long-Short Strategies
- Conclusion
Quant Mutual Fund is set to make history in the Indian investment landscape by launching the country's first long-short fund under the new Specialised Investment Fund (SIF) category. This move comes after the Securities and Exchange Board of India (SEBI) granted Quant the first license to operate such a fund, named the Quant Specialised Investment Fund (QSIF). The fund house, known for its high-conviction investment style, is now positioned at the forefront of a new product class designed for sophisticated investors.
This development marks a significant evolution in the Indian mutual fund industry, offering seasoned investors access to advanced investment strategies previously available only through Alternative Investment Funds (AIFs). While Quant MF is the first to receive this approval, other asset management companies (AMCs) like ICICI Prudential Mutual Fund, SBI Mutual Fund, and ITI Mutual Fund are also reportedly planning to launch their own SIF products.
What are Specialised Investment Funds (SIFs)?
- New Regulated Category: Introduced by SEBI and effective from April 1, 2025, this category represents a new, regulated type of mutual funds.
- Bridging a Market Gap: SIFs are specifically designed to fill the space between traditional mutual funds and Portfolio Management Services (PMS).
- Access to Advanced Strategies: They provide investors a formal way to access sophisticated strategies like long-short investing.
- High Minimum Investment: A minimum investment of ₹10 lakh is required, targeting investors with a better understanding of complex financial products.
- Greater Portfolio Flexibility: SIFs are allowed more flexibility than regular funds, including the ability to hold concentrated portfolios and use derivatives for non-hedging purposes.
Quant's Long-Short Strategies
Quant Mutual Fund has received approval to launch its Quant Specialised Investment Fund (QSIF) with long-short strategies across equity, debt, and hybrid categories. As mentioned in their June 2025 investor factsheet, they are the first to receive a license for such a comprehensive offering.
The specific investment strategies under each category are:
Equity Oriented Investment Strategies:
- Equity Long-Short Fund
- Equity Ex-Top 100 Long-Short Fund
- Sector Rotation Long-Short Fund
Debt Oriented Investment Strategies:
- Debt Long-Short Fund
- Sectoral Long-Short Fund
Hybrid Investment Strategies:
- Active Asset Allocator Long-Short Fund
- Hybrid Long-Short Fund
SEBI's Risk Mitigation Measures
To safeguard investor interests, SEBI has implemented strict exposure limits for SIFs, particularly concerning debt securities. These regulations are designed to manage the higher risks associated with these sophisticated investment products.
The investment limits for company debt securities are as follows:
- A maximum of 20% of the net asset value (NAV) can be invested in AAA-rated debt securities from a single issuer.
- For AA-rated securities, the cap is set at 16% of the NAV from a single issuer.
- For A-rated or below securities, the investment is limited to 12% of the NAV from any single issuer.
Conclusion
The introduction of Quant's long-short fund marks the launch of a new investment category in India. These Specialised Investment Funds (SIFs) give investors access to strategies that can be used in different market conditions.
These funds are regulated by SEBI, which has put rules in place to manage risk. As other fund houses are expected to offer similar products, SIFs will provide new choices for experienced investors in the Indian market.
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