How to Compare SIFs in India: Look Beyond NAV Returns

To compare Specialized Investment Funds in India, start with what each strategy is allowed to do, then inspect what it actually did. A higher NAV return is an outcome, not an explanation of how the outcome was achieved.

For a family office or investment researcher, the useful question is not simply which SIF performed best. It is whether a strategy fills a defined portfolio role, whether its risks are understood, and whether the evidence is strong enough to support that conclusion.

SEBI established the SIF framework in its February 2025 circular, effective from April 2025. The framework includes different strategy types; a shared SIF label does not make their mandates identical. Consult the current strategy documents and applicable amendments before making an eligibility or allocation decision. Source: SEBI’s SIF framework.

1. Write the portfolio job before opening a return table

Suppose an investment committee wants to reduce dependence on a long-only equity portfolio. That is a portfolio objective, not a promise that any long-short product will meet it.

Write a short testable brief: the allocation should diversify specified exposures, fit the required liquidity horizon and remain understandable under stress. Then ask what would disqualify a strategy. An unclear short book, insufficient disclosure or a mismatch between redemption terms and the family’s cash needs can matter more than a strong opening return.

This ordering helps avoid a common mistake: finding an impressive chart first and inventing a portfolio role afterwards. Research should connect the strategy to the existing book, including direct equities, conventional funds and cash commitments.

2. Compare mandates before managers

Build a two-column summary from the strategy documents. Record the investment universe, permitted instruments, intended sources of return, benchmark, liquidity provisions and material constraints. Distinguish a stated objective from a binding restriction.

Two portfolios can both use short positions while making quite different bets. One may hedge a broad market exposure; another may take relative-value positions between companies. A third may combine equity and debt. Their risk cannot be reduced to the word hedged.

Ask what must go right for each approach to work. Is the strategy relying on stock selection, spread convergence, market direction, financing conditions or several of these together? If the explanation is vague, return comparisons will not repair it.

3. Lock the exact plan and a common observation window

A research worksheet needs the full strategy name, plan, option, identifier and dates. Do not splice a regular plan into a direct-plan series, or compare a growth option against a distribution option using an unadjusted NAV chart.

Use a common start and end date where comparable data exists. If one strategy has only a short history, state that limitation rather than assigning it a long-history risk score. A few months of rising markets cannot establish behaviour through a full drawdown and recovery.

AMFI provides official SIF NAV and investor-document entry points. These are useful starting points for identity and disclosure checks, not substitutes for reading the relevant AMC documents. Sources: AMFI SIF NAV and investor corner.

4. Separate return measurement from risk interpretation

Consider a hypothetical comparison. Strategy A returns 6% over a common window; Strategy B returns 4%. These are invented teaching numbers, not results for any actual fund.

Research question	Why it changes the interpretation
Were both return series calculated for the same plan type and dates?	Otherwise the headline comparison is not aligned.
Did A carry more directional equity exposure?	Higher return may reflect a different risk budget.
Were the largest positions concentrated in one economic theme?	Different company names can still share one driver.
Were returns smooth because risk was low or because the window was calm?	A short sample cannot answer every stress question.
Do costs and liquidity terms fit the intended holding period?	The investor’s implementation can differ from a simple NAV chart.

None of these questions proves B is preferable. They prevent a return ranking from pretending to be due diligence.

5. Read holdings as positions, not a list of names

An equity holding and a derivative exposure referencing the same company are not automatically two independent bets. Preserve signs and instrument labels. Distinguish economic exposure from collateral and cash balances before adding anything together.

For a simplified linear equity book, gross and net exposure describe different things. A substantial long and short book can have a modest net position while retaining significant stock-selection risk. Our SIF gross-versus-net exposure guide works through that distinction and explains why a monthly file cannot reveal every risk.

Also inspect changes across disclosures. A single month tells you what was reported at that snapshot; it does not prove that the strategy held the same exposures throughout the month. Avoid presenting disclosure snapshots as a continuous trading record.

6. Keep costs and liquidity in the same worksheet

Record disclosed expenses and their effective dates, but distinguish the expense ratio from all possible implementation effects. Financing, trading and short-position mechanics can matter; do not assume an expense figure completely explains the difference between a strategy and its benchmark.

For liquidity, read the actual provisions. The appropriate question is whether access to capital fits the investor’s needs in a difficult period, not merely whether the product sounds flexible. Verify current terms with the AMC or qualified adviser rather than extrapolating from another strategy.

What Altys contributes

Altys brings available official SIF NAV, expenses, AUM, disclosed holdings and retained documents into a research-ready workflow. Plan identity and reporting dates remain explicit, and tables can be exported for spreadsheet review. This complements mutual-fund research rather than treating every fund-like product as interchangeable.

That does not manufacture a long track record, reveal undisclosed trades or make an incomplete portfolio fully risk-transparent. The purpose is to make the research easier to check and repeat. Coverage gaps should remain visible.

The best comparison ends with a dated decision note: the portfolio role, evidence reviewed, unresolved questions and conditions that would trigger a review. Request Altys access to explore a source-linked fund-research workflow. Allocation and suitability decisions remain the investor’s and their qualified adviser’s responsibility.