Alternative Investment Fund
Alternative Investment Fund (AIF)
Any fund established or incorporated in India
AIF means any fund established or incorporated in India. It is a privately pooled investment vehicle.
It collects funds from investors, whether Indian or foreign.
Categories
Category I AIF
1. Venture capital fund- Invest in start-ups that have a high growth potential but lacking funds to expand further.
2. Infrastructure fund-Invest in the development of public infrastructures like roads, rail, and airports infrastructure
3. Angel Fund-Invest in startups and they bring their experience in business management to guide the company
4. Social Venture Fund-Invest in companies that intend to make a profit while solving social and environmental issues.
Category II AIF
AIFs which do not fall in categories 1 and III.
It does not undertake leverage or borrowing other than day to day operational
Real estate funds, private equity funds, funds for distressed assets are registered as category II AIFs
Category III AIF
AIFs which employ diverse or complex trading strategies.
Various funds such as hedge funds, PIPE funds are registered as category III AIFs.
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