5 Drawbacks of Investing in AIF

Higher Investment Threshold

AIFs often require a larger minimum investment, which can deter small retail investors from accessing these opportunities.

Lock-In Periods

AIFs often have lock-in periods, which can be a drawback when investors need quick access to their funds, especially in emergencies.

Complex and Risky

Alternative investments are riskier and more complex than regular options. Some assets are hard to sell quickly, so investors might need to hold them for a while to see returns.

High Fees

AIFs usually have higher fees than regular mutual funds, including management and performance fees, which can eat into a significant part of the fund's returns.

Limited Transparency

AIFs, while regulated, may offer less transparency than publicly-traded investments. It can be hard to assess the exact value of your investment at any time.