BQ Big Decisions: Here’s What You Need To Know About Alternative Investments For When You Can Make Them
BloombergQuint’s Big Decisions podcast gets you the insights you need to make big money decisions with confidence.
Alternative investments, simply put, are alternatives to traditional investments into equity and debt. They are, especially after recent regulatory changes by the Securities and Exchange Board of India, only accessible to high net worth individuals.
The SEBI has put restrictions on the minimum investment into alternative investment funds and portfolio management schemes—the two vehicles through which alternative investments can be made. Now, investors must invest a minimum of Rs 50 lakh in portfolio management schemes and Rs 1 crore into alternative investment funds.
According to Ashwin Patni, head products and alternatives at Axis Mutual Fund, only individuals with a net worth of more than Rs 2 crore should consider opting for alternative investments. The reason for this is that alternative investments are usually considered to be more complicated than traditional investment options offered by mutual funds, or indeed investments made directly into equity or debt.
However, Patni believes that it is important for retail investors to know about the range of products available after they cross the necessary threshold. On this BQ Big Decisions podcast, BloombergQuint speaks to Patni about the major alternative investments available in India, how they’re categorised, and what one should know about them before choosing to invest in them.