SEBI's Specialised Investment Funds (SIFs) — the framework circular is dated 27 February 2025 — created a middle shelf that Indian investing didn't have: flexible, mandate-driven strategies at a ₹10 lakh ticket, well below PMS's ₹50 lakh and AIF's ₹1 crore, but with room to manoeuvre that mutual funds don't get. The marketing question is "which makes more money?"; the honest question is whether you need the flexibility, and whether the strategy earns its cost. This page covers the rules first.
What exactly is a SIF?
A SIF is a new product class offered by mutual fund houses under SEBI's February 2025 framework — the same AMCs, the same regulatory umbrella, but a separate shelf with looser investment constraints. Strategies span equity-oriented, debt-oriented and hybrid mandates, and the framework permits exposures that traditional open-end funds can't run: meaningful use of derivatives, including positions that profit from falls, within regulatory limits (the circular allows up to 25% of net assets in certain ETF exposures, among other boundaries). Underlying schemes publish their strategy documents, and the AMC's mutual-fund track record is the visible credential behind them.
How is it different from a mutual fund?
- Ticket: the minimum is ₹10 lakh per PAN, aggregated across all of an AMC's SIF strategies — you can split it across strategies from one house, but not across houses. A mutual fund SIP starts at ₹100.
- Mandate: a mutual fund's flexibility is bounded by scheme categorisation; a SIF can run tactical and long-short elements inside its stated strategy. That is the entire product pitch: flexibility, formalised.
- Liquidity: redemption frequency varies by strategy — some offer daily or weekly dealing, others run fixed intervals. Read the scheme document; "fund-like" is not a promise.
- Cost: flexibility and active management are not free. SIF pricing sits above plain index funds by construction; the comparison to make is against the active alternatives it replaces, not against an index SIP.
How is it different from PMS and AIF?
Ticket size is the headline: ₹10 lakh (SIF) versus ₹50 lakh (PMS) versus ₹1 crore (AIF). The structural difference matters more: PMS runs a personalised portfolio in your name; AIFs pool capital into private trusts with bespoke strategies; a SIF pools capital into schemes under the mutual-fund regulatory umbrella — with its disclosure discipline and its charges-cap culture, plus the new flexibility. For a ₹10–50 lakh investor, a SIF is often the first legitimate taste of mandate-driven management without PMS's minimums or concentration.
The four shelves compared
Ticket sizes are regulatory minimums; flexibility and disclosure cultures differ structurally. SIF sits between the mutual-fund umbrella and bespoke portfolio management.
View the numbers as a table
| Shelf | Minimum ticket | Structure | Flexibility | Fits when |
|---|---|---|---|---|
| Mutual funds | ₹100+ | Pooled schemes, tight categorisation | Lowest — bounded mandates | The core of every portfolio |
| SIF | ₹10L per PAN per AMC | Pooled schemes under the MF umbrella, flexible mandates | Derivatives, long-short elements within limits | Satellite strategies at a mid ticket |
| PMS | ₹50L | Portfolio held in your own name | High; concentrated | ₹50L+ investors wanting bespoke management |
| AIF | ₹1Cr | Private trust, pooled, bespoke categories | Highest — least constrained | Accredited-scale alternative strategies |
Verified against SEBI's February 2025 circular and corroborating summaries (Oct 2026). Charges and liquidity vary by scheme.
"Which makes more money?" — the risk-adjusted answer
The honest answer is that flexibility is an option, not a return. A SIF manager who uses derivatives well earns their fee; one who uses them often doesn't. Backtests for new strategies are marketing artefacts — short, self-selected, and unburdened by live scale. The comparison to run: same mandate, same risk, net of all costs — a SIF against the cheapest mutual fund that expresses the same idea, and against doing nothing but holding the index. If the SIF's edge is a strategy an index fund cannot run (hedged equity, tactical debt duration, arbitrage with leverage), the comparison is at least fair; if the edge is "our manager is good", it is not a strategy.
Who is it for, and who should wait?
- Fit: investors at the ₹10 lakh-plus level who want tactical or hedged management as a satellite — 10–20% of a portfolio whose core is boring and index-shaped — and who will read the strategy document, not the one-page pitch.
- Not fit: beginners (the core portfolio and the emergency fund come first — our income ladder still applies); anyone who can't articulate what the strategy does in a falling market; and anyone treating "₹10 lakh minimum" as a signal of sophistication. A minimum is a door price, not a quality certificate.
- Watch for: strategies whose flexibility only ever shows up as leverage, and fee stacks that make the index comparison unwinnable. The category's own regulator did the product design; the market will do the judging.
Educational content, not financial advice. Framework facts verified on 29 October 2026 against SEBI's circular and corroborating summaries (sources below); redemption frequencies, charges and strategy specifics vary by scheme — the scheme information document is the binding text. New-product track records are short by definition.