Sebi rolls out Specialised Investment Fund with Rs 10 lakh minimum investment
December 18, 2024 Market regulator Securities and Exchange Board of India (Sebi) notified a new asset class between portfolio management services (PMS) and mutual funds and has called it the ‘Specialized Investment Fund’ (SIF). The SIF asset class will accept investments of Rs 10 lakh or more across all investment strategies. The new asset class. positioned between MFs and PMS will open different investment products and approaches to Indian investors. Why the Need for SIFs? For many ambitious investors, mutual funds and PMS have long been the go-to investment options. Mutual funds have provided a more hands-off, diversified way to invest, while PMS has catered to those willing to invest larger sums with personalized strategies. However, there has always been a gap between the two. The minimum investment threshold of Rs 10 lakh ensures that these funds remain focused on high-net-worth individuals (HNIs) or accredited investors who have the financial capacity and expertise to manage such investments. These investors are looking for higher returns and are comfortable with more volatile asset classes. With a minimum investment ceiling of Rs 10 lakh, SIFs allow asset managers to allocate up to 15% in a single security—significantly higher than the 10% limit under traditional mutual fund schemes. For fixed income strategies, exposures can now extend to 20% in a single issuer, with the possibility of increasing this to 25% REITs and InvITs: SIFs can allocate up to 20% of their assets to Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs), but they cannot invest more than 10% in any single issuer. This provides a level of diversification while still allowing for targeted exposure to real estate and infrastructure sectors. Mutual funds are more suitable for conservative investors or those with a lower risk appetite. On the flip side, PMS offers tailored strategies but typically requires a significant minimum investment—often too large for smaller investors, and with a complexity that may seem daunting for those without deep financial expertise. This is where the SIF comes in. Can an SIF offer derivatives as an investment strategy? MFs, as of now, cannot offer derivatives as an investment strategy, but only for hedging and portfolio rebalancing purposes. In a draft proposal earlier this year, Sebi had suggested allowing the new asset class to take exposure in derivatives. However, the framework is silent on derivatives—a critical aspect of modern portfolio management. Given India’s prominence in global derivatives volumes, clarity in this area could further strengthen the appeal and versatility of SIFs. In the draft proposal, Sebi also used another example of differentiated products like ‘Inverse ETFs’ that can be offered by SIFs. However, the gazette notification dated December 16 didn’t mention any such product. Taxation rules should be similar to mutual fund, more details are expected from SEBI on this. Meanwhile, I feel that as an evolving asset class, the SIF is a pivotal addition to India’s investment ecosystem, blending flexibility, higher exposure limits, and diversification potential to meet the growing sophistication of investor needs. CA. Atul Kela
![Atomic Habits by James Clear [10 minute summary]](https://caakinvestments.com/wp-content/uploads/2025/03/atomic-habits-img-e1742464595472.jpeg)
Atomic Habits by James Clear [10 minute summary]
People think when you want to change your life, you need to think big. But world – renowned habits expert James Clear has discovered another way. Real changes comes from the compound effect of hundreds of small decisions – doing two push-ups a day, waking up five minutes earlier, or reading just one more page. If we’re someone who has tried and failed to get new habits to stick, then Atomic Habits by James Clear is the book for you. It’s contains a simple framework for how to actually implement habits and reach goals, with lots of insightful tips and tricks along the way. Let’s take a closer look at that framework. Bear in mind this is just a summary – if something resonates I’d highly recommend diving into the whole book. The core message of Atomic Habits by James Clear Often when it comes to planning our new habits, goals, or resolutions, we focus on big changes. We want to run a marathon, become fluent in French, journal every day — and then we wonder why we fail each time. The reality is that we don’t change overnight, and that making new habits (and breaking old habits) takes time. It’s a long game and it takes patience. In Atomic Habits, James Clear talks of the ‘compounding effect’ and the idea that getting 1% better every day leads to large changes over time, even if we don’t notice that change day-to-day. The first part starts to outline the process of building habits, which the rest of the book will then delve into. He defines a habit as ‘a behaviour which is done so many times it becomes automatic’. The four steps to ensure that we keep repeating the behaviour to make the habit stick, are: Make it obvious Make it attractive Make it easy Make it satisfying Step 1: Make it obvious The first step in making a new habit, according to James Clear, is to observe your existing habit. These existing habits also serve to prove the point that if we repeat something enough times, our brain picks up on it and predicts the outcome without any conscious thought i.e. the action becomes automatic. For most of us it just doesn’t feel right to get into bed without brushing our teeth, for instance. This section also covers the importance of environment in making habits stick. It’s partly about making that new cue stand out, such as placing bottle of vitamins on the kitchen counter each night so that we see them in the morning and are reminded to take them. And what about breaking habits? Essentially, it’s the reverse: make it invisible. It’s easier to avoid temptation than to resist it, so we could try putting your video game controller away, out of sight, in a cupboard. Step 2: Make it attractive The more attractive something seems to us, the more likely we want to repeat that behaviour regularly. So, if we can make a new habit seem attractive, we’re more likely to keep doing it. Part of making it attractive is realising that as humans we are social beings, and we tend to imitate the actions of those around us which are seen as positive. This could be people close to us, family and friends, the wider crowd or society we identify with, or people with status and prestige. So, we could join a community or group where our desired behaviour is common, to give ourself further incentive to do that action. We thrive on approval, praise, and respect, and we want to fit in with our tribe — so exploit these things to help build the new habit. To develop a creative writing habit, join a local writing group. To become fitter, start with a gym class or running group. Step 3: Make it easy We humans are simple creatures, and we tend to follow the ‘law of least effort’, taking the option which is easiest or requires the least work. So, to make a behaviour stick, we want to make it as easy as possible to complete. We can do this by reducing the friction with behaviours we want to adopt. If we want to increase fitness levels, lay out workout clothes the night before we plan to go to the gym. The reverse is true with behaviours we don’t want to keep: increase the friction and make them difficult. Hide the chocolate at the back of kitchen cupboard if we don’t want to eat it, for instance. In this section James Clear also sets out the two minute rule: when we start a new habit it should take less than 2 minutes to complete. Planning habits is easy, but ultimately we need to take action to build habits. So start breaking down goals and habits into small steps, starting with the two minute starting action. If you want to run a marathon, start running for 2 minutes each day. Then, repeat that single 2 minute action for long enough to become automatic. Once it feels automatic, like part of your day-to-day routine, add to it to build up the habit. That might be increasing the amount of time we do the behaviour for, or the frequency we do it. We can also make it easier by automating our future behaviour to fit in with the type of person we want to be. If we want to travel more but don’t have the money, set up a direct debit every month after your pay comes in, transferring a small amount into a savings pot. If we want to build a yoga habit, pay for a month’s worth of weekly evening classes upfront and put them in your diary. Step 4: Make it satisfying The previous sections have been about ensuring that a behaviour happens in the first instance (make it obvious, attractive, easy). Making it satisfying is about making sure that we repeat that behaviour again the next time and the time after that — making it a habit rather than a one-off.