The world of single-family offices is booming, and the trend is likely to continue for some time to come. This is a function of the extensive increase in the number of ultra-wealthy and super-rich (net worth = $500 million or more) worldwide. Moreover, many, many billions of dollars are readily flowing from single-family offices to a diverse collection of investments including hedge funds and private equity funds.
Local business houses, financial services groups and Alternative Investment Funds will find it easier to rope in foreign partners to carry out fund management activities in India. The Securities and Exchange Board of India has spelt out that sponsors and managers of alternative investment funds, or AIFs, are covered by its regulations — a stand that will spare the sponsors and managers of these funds from a recent government rule that foreign direct investment (FDI) in unregulated financial services cannot be less than $20 million.
The concept of investments has broadened immeasurably over the past decade. The main reasons being global economic slowdown in 2008 and the on-going technological advances. The ability to go online and choose the best trading platform from a choice of dozens allowed us to look in new directions. The arrival of an exciting new era of cryptocurrencies and the growing trend among private investors to consider real estate represent two alternative investment opportunities at opposite ends of the risk spectrum. But while we might still call these alternative investments, they no longer meet that dictionary definition. 2018 has seen a growing interest in what you might call “alternative alternatives,” as investors continue to push the boundaries.
Markets regulator SEBI has issued a clarification that alternative investment funds cannot convert their existing open-ended schemes to closed-ended and vice-versa.
IIFL Asset Management Limited (IIFL AMC) has launched IIFL India Private Equity Fund, a close-ended SEBI-registered Category II Alternative Investment Fund (AIF), and targets raising around Rs 1,500-2,000 crore.
The finance ministry is planning to set up a fund under the National Investment and Infrastructure Fund (NIIF) dedicated for strategic investments.
Earlier this year, the NIIF kick started its funding activity with global operator of marine and inland terminals DP World by creating a platform for investing up to USD 3 billion in ports and logistics.
UK-based Ocean Dial Asset Management, acquired by financial services firm Avendus Group last year, has launched a maiden public equity fund that aims to raise Rs 1,500 crore ($221 million).
The alternative investment fund has already received commitment of Rs 50 crore ($7.4 million) from anchor investors including family offices and high net-worth or very wealthy individuals.
Edelweiss Alternative Asset Advisors Ltd, a unit of the Edelweiss group, achieved the targeted base offering size of Rs. 2,000 crore for its infrastructure sector focused fund—Edelweiss Infrastructure Yield Plus Fund. The fund aims to raise another Rs. 4,500 crore via a green shoe option in the next 12 months, the company said in a statement.
Hedge funds will need to adopt artificial intelligence and machine learning in order to stay competitive in the years ahead, increasing competition with the likes of Amazon for the brightest technological minds.
That is according to trade body the Alternative Investment Management Association, which spoke to 25 hedge fund executives and academics for a report entitled Perspectives — Industry leaders on the future of the hedge fund industry.
Avendus Capital is raising Rs 3,000 crore to expand its kitty on alternative investments, with the financial services firm targeting family offices, high net worth individuals and corporate treasuries to sell its products.