Bandhan AMC files draft documents for first SIF, Arudha Hybrid Long-Short Fund

The SIF framework, introduced by the market regulator SEBI, is aimed at bridging the gap between traditional mutual funds and alternative investment funds by permitting more advanced and flexible strategies, including long-short and derivative-based approaches, within a regulated structure.

Bandhan Asset Management Company (AMC) has filed draft documents (ISID) for the launch of its first Specialized Investment Fund (SIF), marking its entry into the newly-introduced SIF framework. The proposed offering is the Arudha Hybrid Long-Short Fund, an interval investment strategy combining equity and debt exposure with limited use of derivatives.

According to the draft filing, the fund will invest 35-65% each in equities and debt securities, while allowing short exposure of up to 25% of net assets through unhedged derivative positions. The strategy has been placed in Risk Band Level 2 and will be benchmarked against the CRISIL Hybrid 85+15 Conservative Index.

The fund will be offered at a new fund offer (NFO) price of Rs 10 per unit, with a minimum investment threshold of Rs 10 lakh for investors. It will follow an interval structure, allowing daily subscriptions on business days and redemptions twice a week on Mondays and Thursdays, as per the draft.

Also read: ICICI Pru AMC files draft documents for two SIFs with SEBI

The SIF framework, introduced by the market regulator SEBI, is aimed at bridging the gap between traditional mutual funds and alternative investment funds by permitting more advanced and flexible strategies, including long-short and derivative-based approaches, within a regulated structure.

Bandhan AMC’s filing places it among a growing number of fund houses looking to use the SIF route to cater to sophisticated and high-net-worth investors seeking differentiated return profiles.

The fund will be managed by Kapil Kankonkar, Senior Equity Fund Manager; Brijesh Shah, Vice President – Fixed Income; Debraj Lahiri, Vice President – Credit Research, Fixed Income; and Nilesh Saha, Equity Fund Manager, according to the document.

At present, SEBI has permitted seven investment strategies across equity, debt and hybrid asset classes under the SIF framework.

In the equity category, AMCs can offer three strategies: Equity Long-Short Fund (flexicap), Equity Ex-Top 100 Long-Short Fund focusing on mid- and small-cap stocks, and Sector Rotation Long-Short Fund, which can invest in up to four sectors.

In the debt category, two strategies are allowed -- Debt Long-Short Fund across durations and Sectoral Debt Long-Short Fund investing -- in debt instruments of at least two sectors, with certain relaxations in single-issuer exposure limits.

The hybrid category also allows two strategies: an Active Asset Allocator Long-Short Fund with dynamic exposure across equity, debt, and commodity derivatives, and a Hybrid Long-Short Fund, which must invest a minimum of 25 percent each in equity and debt.