How can I invest in hedge fund in India? (2024)

The fee structure consists of both: a management fee which is generally less than 2% and a profit sharing technique which varies between 10 to 15%. The minimum ticket size to invest in hedge mutual funds is Rs 1 crore per investor and an entire fund needs to have a minimum corpus of Rs 20 crore.

Anyone can invest in a hedge fund as long as they meet the requirements. These conditions include having a net worth of $1 million or more, or earning at least $200,000 within the current year. Again, most hedge fund investors are individuals with substantial wealth.

(Video) #hedge Hedge Fund in India | How Hedge Fund Work in India | How to Start Invest in Hedge Fund

Minimum initial investment amounts for hedge funds range from $100,000 to upwards of $2 million. Hedge funds are not as liquid as stocks or bonds either and may only allow you to withdraw your money after you've been invested for a certain amount of time or during set times of the year.

Hedge funds tend to have specific characteristics and features. They require wealth to participate. Hedge funds typically require an investor to have a liquid net worth of at least $1 million, or annual income of more than $200,000. They often borrow money to use in an investment.

The country's biggest hedge fund manager Avendus Capital Public Markets' Alternate Strategies is expecting the benchmark indices to witness their first ever correction of the current bull market as their quantitative models hint at a possible 15-20 per cent drawdown in the next six months.

Hedge funds in India are categorized under alternative investment funds (AIFs) as defined by Sebi. An alternative investment is one different from traditional long-only positions in stocks, bonds, and cash.

How to Start a Hedge Fund (even if you have NO experience) - YouTube

(Video) Alternative Investment Funding | How to get registered as an alternative investment fund | CA Paras

Bridgewater Associates

Bridgewater is the world's largest hedge fund, with about $150 billion in capital. Since its founding in 1975, Bridgewater has returned $52.2 billion in gains to its investors – more than any other hedge fund on the planet.

High-Risk. In general, hedge funds are considered to be high-risk investments because of the huge potential for money loss. Again, these funds are primarily controlled by hedge funds managers, and with pools of money going into investments, there is likely going to be some loss.

Polish your credentials through unpaid internships or related financial industry jobs so that your resume stands out.

1. Make Sure This Is What You Want. .
2. Study the Hedge Fund Industry. .
3. Use the Three-Circles Strategy. .
4. Identify Hedge Fund Career Mentors. .
5. Get an Internship. .
6. Develop Your Unique Value Proposition.

How much returns do hedge funds give?

Average gains of +4.00% lifted YTD average returns to +11.02%, past the level in 2019 (+10.07%) and to the highest level since 2009 (+19.44%). While average returns in 2020 were elevated, there have been several years of similar returns since 2009 (+10% in 2019, +9% in 2017, +10% in 2013 and +11% in 2010).

1. Consider your motivations for investing. .
2. There are no shortcuts in selecting a hedge fund. .
3. Make sure the hedge fund has significant investments from fund managers. .
4. Know the manager. .
5. Understand the investment objective. .
6. How liquid is the fund? .
7. Understand the risks.

What are the 3 common hedging strategies?

There are a number of effective hedging strategies to reduce market risk, depending on the asset or portfolio of assets being hedged. Three popular ones are portfolio construction, options, and volatility indicators.

A classic example of hedging involves a wheat farmer and the wheat futures market. The farmer plants his seeds in the spring and sells his harvest in the fall. In the intervening months, the farmer is subject to the price risk that wheat will be lower in the fall than it is now.

Some examples of hedge funds include names like Munoth Hedge Fund, Forefront Alternative Investment Trust, Quant First Alternative Investment Trust and IIFL Opportunities Fund. There are others such as Singlar India Opportunities Trust, Motilal Oswal's offshore hedge fund and India Zen Fund.

There are no restrictions on local investors investing in a hedge fund. However, under the AIF Regulations the minimum investment value for each investor must be at least INR10 million. For investors who are employees or directors of the manager, the minimum value of investment is reduced to INR2. 5 million.

You can create a trust, with a set of trustees. You then apply to SEBI to register the trust as an AIF VC Fund, where you will collect money from investors and invest in companies. See SEBI's How to get registered as a VC Fund and the SEBI VC Regulations.

1. SECURITIES AND EXCHANGE BOARD OF INDIA.
2. Incorporation of the Asset Management Company and the Trustee Company/Board of trustees:
3. Auditor's certificate:
4. Filing of executed copies of Trust Deed and Investment Management Agreement.
5. Setting up of Infrastructure by the Applicant.