Quant Mutual Fund is soon going to launch India's first mutual fund based on a long-short strategy. This fund has been named Quant Specialized Investment Fund (QSIF) and has received approval from the Securities and Exchange Board of India (SEBI). This fund will fall under the newly created category of Specialized Investment Fund (SIF).
Through this fund, Quant Mutual Fund is about to step into a completely different and advanced investment product class, which is specially designed keeping experienced and high-net-worth investors in mind. A minimum investment of ₹10 lakh will be required to invest in it.
What is the SIF Category and what is special about it?
Specialized Investment Fund (SIF) was approved by SEBI as a new category within mutual funds through a circular issued on February 27, 2025. This category has been introduced to bridge the gap between traditional mutual funds and Portfolio Management Services (PMS).
The most special thing about this category is that fund managers get more flexibility in creating investment strategies. The fund structure can be equity-based, debt-based, or even a hybrid model. The minimum investment for these funds has been kept at ₹10 lakh so that only serious and experienced investors step into it.
How will Quant's QSIF Work?
Quant's QSIF fund will adopt a dual strategy in the market. On one hand, it will invest in stocks that are expected to increase in price, i.e., take a long position, and on the other hand, it will also take a short position on stocks that are likely to fall in price.
This long-short model will try to provide balanced returns to investors in a volatile market. Through this strategy, risk can be controlled to a great extent and the possibility of profit can be increased.
Why is the Demand for SIF Increasing in the Market?
This new move by fund houses like Quant makes it clear that asset management companies want to strengthen their hold in the SIF sector. According to experts, the reasons for this are as follows:
- More Flexibility in Investment: In SIF, fund managers get more freedom compared to traditional schemes. They can try different strategies, which makes it easier to manage risk.
- Large Investment Start but Less than PMS: Where the minimum investment limit in PMS is very high, in SIF it has been kept at ₹10 lakh. Due to this, mid-level and high-income investors may be interested in it.
- Tax Relief: SIF funds get tax treatment like mutual funds. That is, long-term or short-term capital gains tax will be applicable according to the holding period.
- Designed Keeping High-Net-Worth Investors in Mind: SIF is specially designed for such investors who are looking for a new and mature investment option different from traditional funds.
What will be the Tax Structure on QSIF?
As per SEBI's instructions, the same tax rules will apply to QSIF as apply to general mutual funds. That is, if an investor holds this fund for more than one year, then they will have to pay long-term capital gains tax, and if they sell it in less than one year, short-term tax will be applicable.
Anand Varadarajan, Chief Business Officer, Tata Asset Management, has said that the biggest feature of SIF is that any change in the fund does not directly affect the investor. This gives these funds more stability and tax benefits.
Competition in the Market will Intensify with Quant Mutual Fund
With this new experiment of Quant Mutual Fund, competition in the SIF category may increase further. This step can also inspire other AMCs to launch SIF. Experts believe that the companies that step into this category first will get a big advantage in the form of branding and investor confidence.
Now it remains to be seen when other asset management companies bring their products to this new category and what kind of long-short or multi-asset strategy-based funds are introduced in the market.
A New Option Opened for Investors
Overall, Quant Mutual Fund's QSIF is being seen as the beginning of a new direction for the mutual fund industry in India. In such a situation, experienced investors can now get the benefit of new and agile options apart from traditional equity or debt funds. Options like SIF will give them more freedom to understand the movement of the market while balancing the risk.
