The year 2024 proved pivotal for India’s Alternative Investment Funds—even in a market environment that lagged behind previous years, AIFs delivered compelling risk-adjusted returns.
Here’s a snapshot of what we observed:
Long-Short Strategies:
- Average Return: 13.72% (down from 19.21% in 2023)
- Key Insight: Despite lower absolute returns, these strategies effectively mitigated downside
risks through judicious hedging, outperforming traditional benchmarks like the Nifty50 TRI.
Long-Only Funds:
- Average Return: 26.18% in 2024 (versus 37.92% in 2023)
- Highlights: Focused investments in high-growth sectors helped these funds not only to outperform standard indices but also to stand out amid market headwinds.
Investor Commitment:
Investor allocations to Category III AIFs surged by 77%, reaching ₹1.83 lakh crore by September 2024—a clear indication of growing confidence among high-net-worth individuals in alternative strategies.
Looking Ahead to 2025:
As we transition into 2025, India’s robust growth story, driven by rising consumption and innovation, presents both challenges and opportunities. Funds that adapt to shifting global monetary policies and domestic factors like inflation and interest rates will likely lead the pack. A disciplined investment approach that prioritizes quality, flexibility, and innovation will remain key to sustaining good risk-adjusted returns.
I invite fellow investors, industry professionals, and enthusiasts to share their thoughts on how
these evolving trends are shaping the future of alternative investments.
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—
CA. Prakhar Goyal
Investor | Chartered Accountant | Partner, Satyanarayan Goyal & Co.
