You are here: Home » Markets » News
Business Standard

CRISIL launches benchmark indices to gauge the performance of AIFs

AIFs are sophisticated investment vehicles for the wealthy

Crisil | Alternative Investment Funds | Sebi

Sachin P Mampatta  |  Mumbai 

cash, currency, notes, funds, investment, shares, growth, profit, loss, tax, money, income, earnings
The rating agency said in a statement that the benchmarks would be across the three AIF categories

on Thursday announced the launch of benchmarks for (AIFs), against which investors can measure their performance.

AIFs are sophisticated investment vehicles for the wealthy. They have a minimum investment of Rs 1 crore. The rating agency said in a statement that the benchmarks would be across the three AIF categories.

The first includes VC funds and infrastructure funds, among others. The second includes PE funds and funds that do not make use of leverage. The third makes use of complex trading strategies and leverage, such as hedge funds.

Since many of these invest in illiquid securities or instruments that are not widely traded, returns are difficult to benchmark. This is unlike more the common investment schemes such as equity MFs, which can be benchmarked against an index like the Sensex.

The Securities and Exchange Board of India had brought in benchmarking for AIFs through a circular in February. This followed a consultation paper issued in December 2019. The benchmarks were scheduled to be ready by July 1. The regulator had extended the deadline to October, citing Covid-19.

collected data from various funds to help formulate the benchmarks.

“The launch of AIF benchmarks by will plug help this gap by providing a metric to compare the performance of AIFs with the category average,” said Nagarajan Narasimhan, senior director at CRISIL Research, in a statement.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Fri, October 02 2020. 00:44 IST