ICICI Prudential Mutual Fund Introduces Two Long-Short Investment Strategies Under Sebi-Approved SIF Framework

ICICI Prudential Asset Management Company Launches Two New Investment Strategies

ICICI Prudential Asset Management Company has introduced two new investment strategies, the iSIF Active Asset Allocator Long-Short Fund and the iSIF Equity Long-Short Fund, under its Specialized Investment Fund (SIF) platform. The New Fund Offer (NFO) for both strategies opened on May 19 and will close on June 2, 2026.

The iSIF Active Asset Allocator Long-Short Fund and the iSIF Equity Long-Short Fund are designed to provide dynamic portfolio construction through long-short positioning and derivatives-based risk management. The iSIF Active Asset Allocator Long-Short Fund will invest across equities, debt instruments, commodity derivatives, and InvITs, while also taking limited short exposure through derivatives. The strategy follows a counter-cyclical investment approach aimed at increasing equity exposure during attractive valuation periods and reducing exposure when markets become expensive.

The iSIF Active Asset Allocator Long-Short Fund offers greater flexibility compared to traditional multi-asset mutual funds. For instance, unlike traditional multi-asset funds that are required to maintain 65% gross equity exposure for taxation purposes, this strategy can operate within a 35%-80% equity range depending on market conditions. The fund house will allocate to commodities only when it sees opportunities to generate alpha. The strategy is positioned slightly above an equity savings fund on the risk spectrum, while remaining lower risk than most hybrid funds and other SIF categories.

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The objective of the iSIF Active Asset Allocator Long-Short Fund is to reduce portfolio volatility meaningfully without materially compromising long-term return potential. Investors are effectively trading off a portion of upside participation in exchange for lower volatility and greater portfolio stability.

The iSIF Equity Long-Short Fund will seek investment opportunities across market capitalizations, sectors, and investment styles using an actively managed equity long-short framework. The investment universe includes more than 650 companies under coverage, with stock selection based on business fundamentals, management quality, industry structure, and valuation metrics.

The iSIF Equity Long-Short Fund is being positioned as a diversified flexi-cap-oriented equity strategy with a lower risk profile than traditional diversified equity funds. The fund aims to reduce portfolio risk while delivering returns closer to diversified flexi-cap funds over the long term. The strategy will actively use derivatives, sector allocation, and market-cap shifts to manage volatility and generate alpha.

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The flexibility available under the SIF framework will allow the fund to dynamically increase or reduce mid- and small-cap exposure depending on valuations and market conditions. In falling or range-bound markets, derivative strategies can help generate additional income and improve overall portfolio stability.

The minimum investment for first-time SIF investors has been set at Rs 10 lakh, while existing compliant investors can participate with a minimum investment of Rs 10,000. The benchmark for the iSIF Active Asset Allocator Long-Short Fund will comprise a mix of the Nifty 500 TRI, Nifty Composite Debt Index, domestic gold prices, and domestic silver prices, while the iSIF Equity Long-Short Fund will track the Nifty 500 TRI benchmark.