Specialised Investment Funds
Same label, different funds: hybrid long-short SIFs in two market falls
Eleven hybrid long-short SIFs now share one SEBI category. In March 2026, as the Nifty 50 fell 11.3%, the six that were running ended anywhere between a 0.1% gain and a 7.4% loss. Last week’s fall told the same story. The label sets the rules; the risk band tells you how a fund actually behaves.
Please note: Investments in Specialized Investment Fund involves relatively higher risk including potential loss of capital, liquidity risk and market volatility. Please read all investment strategy related documents carefully before making the investment decision.
Absolute returns on Regular plan Growth NAVs, not annualised. No strategy shown has completed one year. Sources and method are at the end of this note.
Why this category deserves a closer look now
The Nifty 50 lost 11.3% in March 2026, recovered over the following months, and has been slipping again since August, including a 3.1% fall in the four sessions to 1 October.
For investors who want to stay invested but limit how much of a fall they absorb, the hybrid long-short SIF is the newest option. It sits inside the mutual fund framework, with a mutual fund’s disclosure rules, but it can hedge, run arbitrage and take limited short positions that an ordinary hybrid fund cannot.
That flexibility cuts both ways. The same category holds funds built to behave like an arbitrage fund and funds that move almost like an aggressive hybrid fund. Two recent falls show the difference clearly.
What SEBI allows
A Specialised Investment Fund (SIF) is a SEBI-regulated product run by a mutual fund house under a separate brand. The minimum investment is ₹10 lakh per PAN across one fund house’s SIF strategies; accredited investors are exempt. We explain how that floor works in a separate note.
SEBI circular, 27 February 2025
What a hybrid long-short SIF must hold
Interval strategy: SEBI allows redemption at most twice a week. Some strategies offer fewer windows.
One label, three temperaments
Within those limits, the choice that matters most is how much of the equity the manager leaves open to the market. For readers who know mutual fund categories, it helps to think of three temperaments.
Our shorthand, not a SEBI classification
How much equity is left open to the market decides how the fund behaves
Arbitrage-plus
Behaves most like an arbitrage fund
Most of the equity is hedged. Returns come mainly from arbitrage spreads, debt and a small slice of special situations.
Balanced-advantage-plus
Behaves most like a balanced advantage fund
A real net equity position that the manager raises and cuts, using derivatives to do it quickly.
Aggressive-hybrid-plus
Behaves most like an aggressive hybrid fund
Mostly open to the market, with short positions used to add return or trim risk at the edges.
The meters are illustrative. They show the idea, not any fund’s actual exposure, which is in its monthly portfolio disclosure.
Where the eleven sit on the risk scale today
The objective guide is the risk band. Every SIF strategy carries one, from 1 (lowest risk) to 5 (highest). The fund house reassesses it every month from the actual portfolio and must publish it within ten days of month-end.
Risk band · latest monthly disclosures
All eleven by name: one category, four different risk bands
- Altiva Hybrid Long-ShortEdelweiss · 31 Aug portfolio
- Magnum Hybrid Long-ShortSBI · Aug factsheet
- Arudha Hybrid Long-ShortBandhan · Aug factsheet
- Apex Hybrid Long-ShortAditya Birla Sun Life · Jun factsheet
- Infinity Hybrid Long-ShortKotak · summary dated 11 Aug
- Prism Hybrid Long-ShortJio BlackRock · summary dated 14 Aug
- RedHex Hybrid Long-ShortHSBC · Jul factsheet
- Platinum Hybrid Long-ShortMirae Asset · summary, Jul
- qSIF Hybrid Long-ShortQuant · summary dated 10 Sep
- No strategy at this band today
- Titanium Hybrid Long-ShortTata · summary dated 30 Sep
- iSIF Hybrid Long-ShortICICI Prudential · 31 Aug portfolio
Each fund house’s own disclosure as available on 4 October 2026; the date shows the portfolio, factsheet or AMFI-hosted strategy summary the band comes from. Bands are reassessed every month, so check the latest before investing. Listing a strategy here is not a recommendation.
Six of the eleven sit at Band 1 and two sit at Band 5. The same category name covers both ends of the scale.
Test 1: the March 2026 fall
Six strategies had a full month of prices through March. Here is how far each fell, set against the Nifty and the average of three mutual fund categories investors already know.
Test 1 · 27 February to 30 March 2026
How far each fell while the Nifty 50 lost 11.3%
Absolute returns on Regular plan Growth NAVs, not annualised. Category averages are simple averages of every Regular Growth fund in the category with a NAV on both dates; balanced advantage includes dynamic asset allocation funds.
All six fell less than the aggressive hybrid average, and four of the six fell less than the balanced advantage average. The bigger story is the spread inside the category: the gentlest finished flat, while the two that fell most took about two-thirds of the Nifty’s fall.
Test 2: the week to 1 October 2026
By last week eleven strategies were running. Five of them were launched after the March fall, so this was their first real test.
Test 2 · 25 September to 1 October 2026
Four sessions, Nifty 50 down 3.1%: eleven strategies this time
Same method as the March chart. A one-week return says little on its own; it is shown only to compare how the strategies moved against each other and against the market in the same fall.
All eleven fell less than the aggressive hybrid average, and nine of the eleven fell less than the balanced advantage average. Even the gentler strategies were not alike, though: eight of the eleven ranged from flat to a 1.25% loss. Three strategies that took between 9% and 20% of March’s fall took between 38% and 55% of last week’s.
A risk band can move
Bands are not fixed at launch. Tata’s Titanium Hybrid Long-Short has switched between Band 3 and Band 5 three times this year as its portfolio changed.
Risk band history · Titanium Hybrid Long-Short (Tata)
3, then 5, then 3, then 5 again, in four month-ends
Solid points come from the fund house’s change notices for each month-end portfolio. Hollow points: no change was notified for July or August, and its summary document dated 30 September 2026 shows Band 5.
Two of the newer strategies moved the other way. Kotak’s Infinity and Jio BlackRock’s Prism were launched at Band 2 and were placed at Band 1 at their first month-end assessment.
Our reading
In two sharp falls, the category did what it was designed to do: every strategy lost less than the market. For an investor who is uneasy about equities but does not want to sit entirely in debt or arbitrage, that cushion is a real benefit.
But “hybrid long-short” tells you the rules, not the risk. Two funds in this category can behave as differently as an arbitrage fund and an aggressive hybrid fund. Choose on the risk band and the strategy document, and then judge the fund against the mutual fund category it most resembles.
A smaller fall usually comes with a smaller share of the recovery. A strategy that barely moved in March is unlikely to lead a strong rally, and that trade-off is the point of owning it.
It is still early. The oldest of these strategies turns one this month and most are much younger. Two falls are a stress test, not a track record.
Before you invest: four checks
Read the risk band, not the label
Check the latest monthly band on the fund house’s website or AMFI’s SIF pages, and how often it has changed.
Open the scenario analysis
Every SIF’s strategy document must show the loss it expects in different market moves. That page says more than any brochure.
Know your exit days
Redemption is on set days, at most twice a week, and exit loads and notice periods differ from fund to fund.
Mind the ₹10 lakh floor
It applies per PAN across one fund house’s SIFs. If a fall in NAV takes you below it, you can stay invested, but you can then only redeem in full.
Sources and method
- Rules: SEBI circular on the regulatory framework for Specialized Investment Funds, 27 February 2025.
- Number of strategies: AMFI SIF Monthly Report, August 2026.
- Risk bands: each fund house’s monthly disclosures, factsheets and notices, and the investment strategy summary documents on AMFI’s SIF pages, as available on 4 October 2026.
- Returns: NAVs as published by AMFI and Nifty closes as published by NSE, compiled through StockEdge. Windows are 27 February to 30 March 2026 (31 March was a market holiday) and 25 September to 1 October 2026 (2 October was a holiday). Category averages are calculated by RHB Wealth Pro. Index returns are price returns.
Specialised Investment Funds are offered only through Raja Banka (ARN-347811), who holds the NISM Series-XIII Common Derivatives certification that SEBI requires for distributing SIFs. This note is general information at category level; strategies are named only to show their risk bands, returns are shown without fund names, and none is recommended.
Investments in Specialized Investment Fund involves relatively higher risk including potential loss of capital, liquidity risk and market volatility. Please read all investment strategy related documents carefully before making the investment decision.
Mutual fund investments are subject to market risks, read all scheme related documents carefully. Past performance may or may not be sustained in future.
Questions this raises
What is a hybrid long-short SIF?
It is a Specialised Investment Fund strategy that must keep at least 25% in equity and at least 25% in debt, and may take unhedged short positions through derivatives of up to 25% of net assets. It is run by a mutual fund house under a separate SIF brand and is an interval strategy.
How did hybrid long-short SIFs perform in the March 2026 market fall?
The six strategies with a full March record ranged from a 0.1% gain to a 7.4% loss between 27 February and 30 March 2026, while the Nifty 50 fell 11.3%. These are absolute returns on Regular plan Growth NAVs. Past performance may or may not be sustained in future.
Are hybrid long-short SIFs less risky than equity funds?
They are built to swing less than an equity fund, and in both recent falls every strategy fell less than the Nifty 50. But risk varies widely inside the category, from Band 1 to Band 5, and SIFs carry their own risks, including potential loss of capital, liquidity risk and market volatility.
How is a hybrid long-short SIF different from an arbitrage or balanced advantage fund?
Arbitrage and balanced advantage funds are mutual fund categories with tighter rules and no unhedged short positions. A hybrid long-short SIF can sit anywhere from arbitrage-like to aggressive-hybrid-like, depending on how much of its equity it leaves unhedged.
What does the SIF risk band mean?
It is a five-level scale from 1 (lowest risk) to 5 (highest risk). The fund house reassesses it every month from the actual portfolio and publishes it within 10 days of month-end, so it can change.
What is the minimum investment in a SIF?
₹10 lakh per PAN, counted across all SIF strategies of one fund house. Accredited investors are exempt.
Can I redeem a hybrid long-short SIF any day?
No. Redemption happens on set days, at most twice a week under SEBI's rules, and some strategies offer fewer windows. Exit loads and notice periods differ between funds.
This note is general information at asset-class level. It is not investment advice and no scheme is recommended. RHB Wealth Pro is a distributor of financial products and is not a SEBI-registered investment adviser.
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