HDFC Mutual Fund Enters SIF Space With Hybrid Long-Short Fund; NFO Opens November 13

HDFC Mutual Fund has entered the Specialised Investment Fund (SIF) segment with the launch of its first strategy, the H-SIF Hybrid Long-Short Fund. The fund will combine debt, arbitrage and derivatives, with limited short positions, to generate returns across different market conditions.

The New Fund Offer (NFO) opened on November 13 and will close on November 27, 2026.

The fund is structured as an interval investment strategy, investing in equity and debt securities and using derivatives to take limited short exposure. It is positioned as an Arbitrage+ strategy, with a focus on generating returns from multiple sources rather than depending entirely on the direction of the stock market.

HDFC Mutual Fund's entry comes as the SIF category gains traction among investors. According to the Association of Mutual Funds in India (Amfi), assets under management (AUM) in the category increased from around Rs 2,010 crore in October 2025 to Rs 42,670 crore in October 2026. Hybrid long-short strategies accounted for the largest share.

Commenting on the launch, Navneet Munot, managing director and chief executive officer of HDFC Asset Management Company, said, “Investors have placed their trust in HDFC Mutual Fund through many market cycles, with several of our funds completing more than three decades, and that trust shapes how we approach every new offering. SIFs can provide investors access to sophisticated strategies within a transparent and well-regulated framework. As investor needs evolve, we launch H-SIF, our Specialised Investment Fund platform backed by our emphasis on risk management and a team with deep experience across equities, derivatives and fixed income. With H-SIF, our endeavour is to offer investors a new way to participate in India’s growth, guided by the same discipline that has defined our journey so far.”

How Will H-SIF Hybrid Long-Short Fund Invest

The fund will build its core portfolio around high-quality debt securities, arbitrage opportunities and Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs). These investments are expected to provide a relatively stable return base.

It will use derivatives to manage portfolio risk, hedge positions, earn option premiums and take limited short positions. The fund can take short positions of up to 25 per cent of its net assets.

It will also look for opportunities in corporate events such as initial public offerings (IPOs), buybacks, open offers and mergers.

The strategy aims to generate returns through interest income, arbitrage spreads, option premiums and tactical investments in special situations. It is designed for flat, mildly rising and volatile markets, with a preferred investment horizon of more than 18 months.

Paul S Parampreet, fund manager - equities at HDFC Asset Management Company, said, “Periods of volatility tend to make investors hesitant, but they can also create opportunities for a strategy designed to use them. Our focus is on building a portfolio that does not rely on a single source of return. While the core exposure is meant to anchor the portfolio, derivatives would allow us to manage risk actively and endeavour to benefit when volatility is elevated. We will remain selective and disciplined in the positions we take, with the aim of offering investors a relatively steady experience over their investment horizon.”

Who Will Manage The Fund

The fund will be managed by a team of four professionals with experience across equity, debt, derivatives and overseas investments. Paul S Parampreet and Ihab Dalwai will manage the equity investments, while Anil Bamboli will oversee the debt portfolio. Gopal Agrawal will be responsible for overseas investments.

Minimum Investment, Redemption And Exit Load

The minimum investment requirement is Rs 10 lakh across SIF strategies at the Permanent Account Number (PAN) level. Accredited investors can invest a minimum of Rs 10,000, subject to applicable conditions.

Investors can subscribe to the fund daily, while redemptions will be available twice a week, on Mondays and Wednesdays.

An exit load of 0.5 per cent will apply to units redeemed or switched out within 90 days of allotment. No exit load will be charged after this period.

The product carries a risk rating of Level 2, as indicated in the risk-band illustration on page 2 of the fund house's announcement. However, investments in SIFs involve relatively higher risks, including potential capital loss, liquidity risk and market volatility.

Investors should read the Investment Strategy Information Document (ISID) and assess whether the strategy suits their investment objectives and risk appetite before investing.