Edelweiss Mutual Fund has launched a new offering under its Altiva Specialized Investment Fund (SIF) platform – the Altiva Hybrid Long-Short Fund. While this is technically not a traditional mutual fund NFO, it works in a similar way since units are being offered at ₹. 10 during the initial subscription window. Hence, for ease of understanding, we will refer to it as an “NFO” in this review. The NFO opens on October 1, 2025, and closes on October 15, 2025. With a minimum investment of ₹. 10 Lakhs, this fund is targeted at High Net-worth Individuals (HNIs) and accredited investors who are seeking tax-efficient, diversified, and hybrid strategies within the mutual fund framework. In this article, we will provide a detailed review of Altiva Hybrid Long-Short Fund NFO, covering its features, investment objective, allocation strategy, risks, taxation aspects, and whether investors should consider investing.
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What are Specialized Investment Funds (SIF)?
Specialized Investment Funds (SIFs) are a newly introduced category in the Indian investment space, designed to provide investors with strategies beyond traditional mutual funds. Think of them as a bridge between mutual funds and AIFs/PMS – offering sophisticated strategies, regulatory oversight, and favorable taxation.
Key Benefits of SIFs
- Operates within SEBI’s mutual fund regulations.
- Minimum investment ₹. 10 lakhs (vs ₹. 50 lakhs in PMS and ₹. 1 Cr in AIFs).
- Equity LTCG taxed at 12.5% after 12 months.
- Wider flexibility with arbitrage, derivatives, hybrid allocations, and special situation investing.
Categories of SIFs by Edelweiss
Altiva SIF has approval for 7 differentiated strategies:
- Equity Long-Short Fund
- Equity Ex-Top 100 Long-Short Fund
- Sector Rotation Long-Short Fund
- Debt Long-Short Fund
- Sectoral Long-Short Fund
- Active Asset Allocator Long-Short Fund
- Hybrid Long-Short Fund (currently launching)
Difference Between Mutual Fund and SIF
| Feature | Mutual Fund | SIF |
|---|---|---|
| Minimum Investment | ₹. 100 | ₹. 10 Lakh |
| Taxation | Investor level, per transaction | Equity LTCG – 12.5% (after 12 months), Debt – slab rate |
| Strategies | Basic (hedging allowed) | Long-short, Arbitrage, Special Situations, Derivatives |
| Investors | Retail | HNIs & Accredited Investors |
Altiva Hybrid Long-Short Fund NFO Details
- Fund House: Edelweiss Mutual Fund
- Fund Type: Interval Hybrid Long-Short Fund (SIF)
- NFO Opens: October 1, 2025
- NFO Closes: October 15, 2025
- Reopens on: October 31, 2025 or earlier
- Minimum Investment: ₹. 10 Lakhs (₹. 1 Lakh for accredited investors)
- Plans: Regular & Direct, Growth & IDCW options
Investment Objective
The scheme aims to generate medium to long-term returns through capital appreciation and income by investing across:
- Equity & equity-related instruments
- Fixed income instruments
- Arbitrage opportunities
- Special situations (IPOs, buybacks, mergers, QIPs, index rebalancing, etc.)
- Derivative strategies (covered calls, straddles, strangles, pair trades, protective puts)
Indicative Asset Allocation Pattern
| Asset Class | Min | Max |
|---|---|---|
| Equity & related instruments | 25% | 75% |
| Debt & money market | 25% | 75% |
| Unhedged derivative exposure | 0% | 25% |
| REITs & InvITs | 0% | 20% |
| Overseas securities | Up to 30% | |
| Securitized debt | Up to 25% of debt |
Why Invest in Altiva Hybrid Long-Short Fund?
- ✅ Multiple return drivers – debt income, arbitrage spreads, and equity-linked upside.
- ✅ Special situation opportunities like IPOs, mergers, and buybacks.
- ✅ Risk-managed derivative strategies – covered calls, pair trades, straddles.
- ✅ Back-tested performance shows outperformance vs arbitrage strategies on rolling returns.
- ✅ Tax efficiency – equity LTCG at 12.5% after 12 months.
Risks in Altiva Hybrid Long-Short Fund
- ❌ Equity risk – daily volatility impacts NAV.
- ❌ Debt risk – interest rate, credit, and reinvestment risk.
- ❌ Derivative risk – leverage effect, liquidity risk, operational errors.
- ❌ Unhedged derivative risk – amplified losses in adverse markets.
- ❌ Liquidity risk – interval structure allows redemption only on Mondays & Wednesdays.
Taxation
- Equity LTCG: 12.5% if held > 12 months.
- Equity STCG: 20% if held < 12 months.
- Debt Income: Taxed at investor’s slab rate.
This makes it more efficient vs PMS/AIF for long-term investors.
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Who Should Invest?
- HNIs and accredited investors looking for diversification and tax efficiency.
- Investors with a 3-5 year horizon.
- Those comfortable with interval liquidity.
Conclusion – Should You Invest?
Altiva Hybrid Long-Short Fund is among the first movers under the SIF platform. It provides diversified exposure across equity, debt, derivatives, and special situations, with better taxation compared to AIF/PMS. However, the high entry barrier (₹. 10 lakh minimum), complex strategies, and limited liquidity mean this is not suitable for retail or conservative investors.
👉 Our View: Suitable for HNIs seeking innovative hybrid strategies with medium to long-term horizon. Risk-averse investors should avoid.
FAQs on Altiva Hybrid Long-Short Fund
1. Is Altiva Hybrid Long-Short Fund a mutual fund?
No, it is a Specialized Investment Fund (SIF) strategy launched by Edelweiss. It works under the mutual fund framework but is different from traditional schemes.
2. Can retail investors invest in this fund?
No. The minimum investment is ₹. 10 lakhs (₹. 1 lakh for accredited investors). It is designed for HNIs and sophisticated investors.
3. How is this fund taxed?
Equity LTCG is taxed at 12.5% if held over 12 months. Debt is taxed at your slab rate. Equity STCG is taxed at 20%.
4. What is the liquidity structure of this fund?
This is an interval fund. Redemptions are allowed only twice a week – every Monday and Wednesday.
5. How does this fund generate returns?
Through a mix of fixed income, equity, arbitrage, derivatives, and special situations like IPOs, buybacks, and mergers.
6. Who should consider investing?
HNIs and accredited investors with a 3–5 year horizon who want diversification and tax efficiency beyond traditional funds.
7. I want to invest ₹10 lakh across multiple strategies of a single AMC SIF (e.g., ₹4 lakh + ₹4 lakh + ₹2 lakh). Is this possible?
No. Currently, most AMCs launch only one strategy per SIF, and the minimum investment per strategy is ₹10 lakh. You cannot split a single ₹10 lakh investment across multiple strategies.
8. What happens if the AMC launches a new strategy later?
You would need to invest a fresh ₹10 lakh for that new strategy. Each strategy is treated as a separate investment.
9. Is there a way to diversify across strategies without committing ₹10 lakh per strategy?
Only if an AMC launches a multi-strategy SIF (rare) or by investing in different SIFs from different AMCs. Otherwise, SIFs are meant for larger, single-strategy investment.
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