Alternative Investment Fund (AIF)

An Alternative Investment Fund (AIF) is a privately managed investment pool that gathers capital from sophisticated investors, both local and international, to follow a specific investment strategy for the benefit of its investors. AIFs are divided into three main categories based on their investment objectives.

AIF Category I

These funds primarily focus on early-stage investments in equity and debt instruments.

• Venture capital funds (including angel funds)
• Funds supporting small and medium-sized enterprises (SMEs)
• Social venture funds
• Infrastructure funds

AIF Category II

Category II encompasses funds that invest in alternative assets such as real estate and unconventional strategies related to unlisted equities, which do not fit within the definitions of Category I or Category III AIFs.

AIF Category III

Category III AIFs predominantly engage in investments in the public equities market using diverse strategies, often including derivatives. These funds are commonly known as hedge funds.