Investing in the world of investment presents you with a number of options. We are all familiar with some common investment options, such as mutual funds and real estate. However, there is more to it. Apart from these common options, there is a basket of popular alternate investments like PMS, AIF, REITs, InVITs, etc.

Let’s understand the basic concepts:

1. Portfolio Management Service (PMS):

PMS provides you with a way to tailor your portfolio according to your goals and personal preferences to maximize your returns while minimizing the risk. Investing in PMS means you can own bonds or shares in your name. PMS is segregated into 2 types:

• Discretionary

Here,  the portfolio manager has the authority to make investment decisions on behalf of the client without requiring prior approval for each transaction.

• Non-Discretionary

Under this, the portfolio manager provides investment advice, but the client retains the authority to approve or disapprove of investment decisions.

• Advisory

The portfolio manager provides advice to the investor; however, the execution is done by the investor.

2. Alternate Investment Funds (AIF):

An Alternative Investment Fund differs from a conventional investment instrument in that it is a special type of investment. The fund is privately pooled. Since AIFs require substantial investments, institutions, and HNIs normally invest in them. Although it invests in both listed and unlisted asset classes, its primary focus is on investing in securities other than debt and equities. The minimum investment that it carries is Rs. 1 crore!

3. Real Estate Investment Trusts (REITs):

Simply put, they are nothing but investments made in real estate. It is a way for regular people to invest in real estate without buying actual properties. Investing in a REIT is like buying a piece of several real estate properties. You earn a share of the rental income, and it's a way to make money from real estate without having to be a landlord or buy an entire property on your own.

4. Infrastructure Investment Trusts (InVITs)

A diversified combination of equity and debt instruments, Infrastructure Investment Trusts are listed on different trading platforms, like stock exchanges.

With InvITs, the infrastructure sector of India is primarily targeted at encouraging more individuals to invest in it, which can be modified according to the situation.

It is generally used to invest income-generating assets by pooling money from several investors.

Where do we invest?

As said above, there are multiple options to invest in. Before you make a decision, let’s understand their pros and cons.

Deciding where to invest your money is a crucial financial decision. Your choice should align with your financial goals, risk tolerance, and time horizon. Diversification is key to managing risk, so consider spreading your investments across different asset classes.

It's also essential to stay informed, periodically review your portfolio, and adjust your investments as your circumstances change.

Disclaimer: The above information should not be relied upon for personal or financial decisions, and you should consult an appropriate financial professional for specific advice. The information presented under our newsletter and blogs is solely for informational purpose