FYERS, a leading financial services platform, is set to launch a Category III Alternative Investment Fund (AIF) in the second quarter of 2026, aiming to raise Rs 1,000 crore. The announcement was made by company officials, highlighting the fund's focus on compensating fund managers for superior performance.
Fund Details and Objectives
The Category III AIF will be open to investors seeking high returns through a diversified portfolio of equities and derivatives. According to FYERS founder and CEO, Shreyas Khoday, the fund is designed to attract sophisticated investors who understand the risks and rewards of such investments. “The idea of investing in PMS/AIF is to compensate fund managers for superior performance,” Khoday said.
Target Corpus and Timeline
The fund aims to raise Rs 1,000 crore through a combination of domestic and international investors. FYERS plans to launch the AIF in Q2 2026, with a focus on leveraging its proprietary trading technology and research capabilities. The company expects to achieve the target corpus within 12-18 months of launch.
Market Context and Strategy
Category III AIFs are hedge funds that can use leverage and derivatives to generate returns. FYERS' entry into this space comes amid growing demand for alternative investment products in India. Khoday emphasized that the fund will employ a long-short equity strategy, aiming to deliver alpha regardless of market conditions. “We believe our technology-driven approach will give us an edge in identifying mispriced securities,” he added.
Investor Suitability and Minimum Investment
The AIF will target high-net-worth individuals (HNIs) and institutional investors, with a minimum investment of Rs 1 crore. FYERS plans to offer a performance fee structure that aligns with investor interests. The fund will be managed by a team of experienced portfolio managers with a track record in quantitative trading.
Regulatory Compliance and Risk Management
FYERS has obtained necessary approvals from the Securities and Exchange Board of India (SEBI) for the AIF. The company will implement robust risk management frameworks, including position limits and stop-loss mechanisms, to protect investor capital. Khoday stated, “Our priority is to ensure transparency and compliance with all regulatory norms.”
Industry Impact and Future Plans
The launch is expected to strengthen FYERS' position in the asset management space. The company also plans to introduce more AIF categories in the future, depending on market response. With this initiative, FYERS aims to democratize access to sophisticated investment strategies for eligible investors.
According to industry analysts, the Indian AIF market has been growing steadily, with Category III funds attracting significant interest due to their potential for higher returns. FYERS' move is likely to intensify competition among asset managers.
