Assets under management for Specialised Investment Funds (SIFs) grew 30% month-on-month to reach ₹23,177 crore in July 2026. This growth was driven by strong inflows into hybrid and long-short strategies amid market volatility. While these funds offer new diversification options, investors should note that they differ from traditional mutual funds regarding liquidity, strategy complexity, and shorter track records.
Specialised Investment Funds (SIFs) witnessed a significant uptick in activity during July 2026, with their total assets under management (AUM) climbing to ₹23,177 crore. This represents a 30% rise from the ₹17,858 crore recorded in June, according to data from the ValueMetrics Mutual Fund & SIF Flow Meter. The investor base for these funds is also growing, with the number of folios reaching 94,447 by the end of the month, edging closer to the 100,000 mark.
Hybrid Strategies Lead Growth
Hybrid investment strategies continue to be the primary driver for this asset class, accounting for roughly 71% of the total assets managed, or ₹16,524 crore. Within this group, Hybrid Long-Short Funds have emerged as the dominant choice for investors. These specific funds saw their AUM jump by 29% in July, reaching ₹15,374 crore. This segment alone now makes up about 66% of the total money managed across all SIFs.
Equity-oriented strategies also posted solid growth, with their AUM increasing by 32% to reach ₹6,654 crore. These strategies contributed to the total monthly inflow of ₹4,922 crore, which was a 30% increase compared to June. Since October 2024, these funds have collectively attracted over ₹22,300 crore, indicating a steady rise in interest among investors looking for products beyond standard long-only equity funds.
Market Volatility and Investor Choices
The growth in SIFs is largely tied to the market volatility observed over the past two quarters. Many of these funds use strategies such as market-neutral or long-short approaches, which aim to perform or hedge against swings in the equity market. This has made them attractive to investors who are concerned about potential downturns or high market fluctuation.
Important Considerations for Investors
While the growth figures are notable, it is essential for investors to understand that SIFs operate differently from traditional mutual funds. Most of these structures were introduced relatively recently—largely after April 2025—meaning they do not have the long-term performance history that investors typically rely on for established mutual funds.
Additionally, these funds often employ more complex strategies, which can carry different risk profiles. Liquidity is another important factor; unlike regular mutual funds, which offer high liquidity, some specialised funds may have specific notice periods or restricted redemption timelines. Investors should also be aware that the higher complexity of these strategies may result in different expense structures. As the market continues to evolve, the key factors to track will be the consistency of these fund performances, their ability to manage volatility, and how they perform during calmer market phases when the benefits of long-short strategies may be less pronounced.