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Hybrid long-short SIFs gain share as investors move from arbitrage
Hybrid SIFs held 71% of total SIF assets, worth ₹17,858 crore as of June-end, as distributors said some investors were already reallocating from arbitrage and balanced advantage funds.
Hybrid long-short strategies within India’s newly launched Specialised Investment Funds are starting to challenge traditional arbitrage funds and balanced advantage funds, according to LiveMint Markets, which cited comments from fund distributors and SIF-focused experts.
The story said fund houses are marketing these hybrid SIFs as “arbitrage-plus” or “balanced advantage-plus” products, positioning them as more flexible than older mutual fund categories. Experts told LiveMint that if the trend continues, hybrid SIFs could pressure the larger ₹3.44 trillion arbitrage mutual fund category and the ₹2.54 trillion balanced advantage funds category.
LiveMint Markets reported that a segment of corporates and retail investors has already been shifting money from arbitrage and BAF funds into hybrid SIFs. It added that hybrid SIFs account for 71% of total SIF assets, which stood at ₹17,858 crore as of June-end, citing AMFI data.
Distributors said they have seen demand from both institutions and retail investors, with Sandeep Seth, founder and CEO of SIF 360, noting that his platform’s average ticket size in SIFs is ₹33 lakh. The article also listed hybrid long-short funds across “BAF plus” and “arbitrage fund plus” positioning, including products from ICICI Prudential, Tata, Quant, Bandhan, and Edelweiss, and explained that the key differentiator is flexibility in how the strategies can use equity exposure, long and short positions, and directional bets.