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Wealth isn’t just about numbers it’s about freedom, legacy, and responsibility. In a world of constant change,
traditional investments can feel outdated.

Enter alternatives.

Think of them not as “more returns” but as smarter constructs. From private equity to hedge funds, alternatives
offer diversification, downside protection, and access to expert-driven strategies. If traditional assets are your comfort food, alternatives are the curated tasting menu complex, intentional, and built for what’s next. Alternatives are all about better constructs.

Why look beyond the traditional?

Imagine driving a sports car with only two gears equities and bonds. That worked for a while. Until it didn’t.
The traditional 60:40 portfolio long hailed as the gold standard is showing its age. Events like the US banking crisis, geopolitical flare-ups, and the end of zero-interest-rate policies have cracked the formula. We call this a
world of: Permanent macro shifts, events that reset market cycles and a rapid evolution in business and consumer behaviour.

The alternative advantage: What it really means

Alternatives aren’t a single category they're an ecosystem. A spectrum of products. Each with its own
risk-return DNA. Each designed to capture value differently through strategy, access, or
structure.

They offer:

• True diversification – Less correlation with public markets
• Tailored risk-reward profiles – From venture bets to stable income
• Drawdown protection – Especially in turbulent times
• Access to niche opportunities – Often not available in listed markets

And above all, they offer something that HNIs (High Net Worth Individuals) increasingly seek: control and
curation.

Unlike public markets, alternatives allow investors to influence when and where their capital is deployed, align
strategies with personal convictions, and engage more deeply with underlying assets. This intentionality across
risk, structure, and theme is what makes the experience both bespoke and empowering.

Let’s decode the landscape.

Alternatives come in many forms. Let us begin with Alternative Investment Funds or AIFs.
SEBI-regulated AIFs pool capital to invest beyond stocks and bonds think social ventures (Category I), broader strategies like private equity, private debt and real estate (Category II), and Long Only and hedge funds (Category III). Each caters to different risk appetites and investment horizons, with minimum investments starting at INR 1 crore.

Separately, Portfolio Management Services (PMS) offer tailored, hands-on portfolio curation for those seeking bespoke strategies aligned to their goals, risk profiles, and market views. While a part of the alternatives landscape, PMS invest in listed securities.

Meanwhile, technology-driven platforms such as Grip Invest, Wint Wealth etc. are democratising access to non-traditional assets from private debt to collectibles once reserved for the ultra-wealthy, broadening the alternatives horizon for a new generation of investors.

For collectibles, startups like Artiana and AstaGuru are using digital platforms and marketing to connect
collectors with rare artifacts across borders. Meanwhile, established players such as Saffronart and Osian’s are
adapting to the shift by offering curated collections through hybrid auction models¹.

Reportedly, AIFs and PMS are projected to cross INR 100 lakh crore in assets by 2030. With a 33% CAGR over the past decade, the segments have already amassed INR 18.87 lakh crore as of FY25². This momentum reflects growing investor appetite for differentiated strategies, expert-led management, and the pursuit of alpha beyond conventional markets.

A closer look at what’s inside

Venture Capital & Angel Funds
Backing tomorrow’s game-changers

Venture capital (VC) provides early-stage funding to startups with high growth potential, aiming for significant returns. Think Zomato, Nykaa, Razorpay. VC firms pool money from investors and also invest their own funds, supporting companies through growth and seeking exits typically within 5-7 years. This funding fuels innovation and helps promising businesses scale rapidly. Angel funds go even earlier, backing bold ideas based on pitch and potential. India’s venture capital landscape found its rhythm in 2024, with funding reaching USD 13.7 billion (INR 11.65 lakh crore) 1.4x higher than the year before³.

Private Equity

Driving growth beyond the public markets

Private equity involves wealthy investors funding private companies not listed on stock exchanges, aiming for substantial long-term returns. It offers HNIs and institutions a chance to back promising businesses through expansion and acquisitions. Though it requires significant capital and patience, private equity plays a crucial role in driving business growth and economic development beyond traditional market avenues. In 2024, domestic PE investments were valued at approximately USD 29 billion⁴ (INR 24.65 lakh crore).

Venture Debt

Fueling innovation, preserving ownership

Offering non-dilutive financing, venture debt provides founders with the flexibility to scale operations while preserving equity dilution an increasingly attractive proposition in a competitive funding environment. Leading startups such as Ola Electric and Bluestone have leveraged venture debt ahead of their public listings, signalling broader institutional acceptance of this capital strategy.

Real Estate

From passive to participative

India’s real estate (RE) sector is seeing a shift from direct ownership to smarter, structured participation through AIFs (Alternative Investment Funds) and Real Estate Investment Trusts (REITs). RE funds pool capital for investing in residential, commercial, and mixed-use development projects and offer institutional-grade access to individual investors. They combine regulatory comfort with the potential for steady income through rental yields, without the hassle of direct property management. As of the quarter ending March 31, 2025, in AIFs, real estate alone accounts for 12% of the total cumulative net figure⁵. REITs distributed USD 709 million (INR 60,265 crore) in FY25, up 13% from the previous year⁶.

Infrastructure Funds

Build wealth by building the nation

These funds, which come under CAT I AIFs, invest in India's growth story, highways, airports, power plants, and more. They're long-term, stable, and aligned with the country's economic development. The returns may be slow and steady-but they are strong and dependable.

Private Credit/Debt Funds

Lending smart. Earning steady

These funds, which fall under CAT II AIFs, provide tailored loans to businesses that banks might overlook-secured, structured, and negotiated for upside. A unique mix of fixed-income stability and private market flexibility.

Social Venture Funds

Invest where your values and returns meet

From affordable healthcare to clean energy and education tech, these funds, accessible through CAT I AIFs, support businesses that solve real-world problems. You don't just grow your capital -you grow your impact.

Hedge Funds

Tactical, nimble, and built for volatility.

These funds use strategies like long-short, macro trades, or event-driven bets. They aim to perform in up, down, or sideways markets-though they come with higher complexity. In India, Category III AIFs account for USD 17.14 billion (INR 14.57 lakh crore) and among this, hedge funds, represented primarily by long short CAT III funds, make up around 15-18%, and absolute return strategies make about 10% while the rest are long only funds⁷.

The finer things: Wine, Art and Collectibles

Investing in passion and rarity

From vintage wine and contemporary art to luxury watches and rare coins, collectibles are gaining currency as alternative investments. For discerning investors, these tangible assets offer more than aesthetic or sentimental appeal they provide a hedge against market volatility and add meaningful diversification.

How to access alternatives

PMS

• Minimum Investment: INR 50 lakh (as per SEBI).
• Structure: Assets held in your name via demat & bank account.
• Ongoing Access: Regular reports and dashboards.

AIFs

• Minimum Investment: INR 1 crore (INR 25 lakh for fund employees/directors)
• Structure: A pooled investment vehicle regulated by SEBI.
• Categories: CAT I: Venture Capital, Impact, Infrastructure; CAT II: Private Equity, Real Estate, Private Debt; CAT III: Hedge Funds, Long-Short Strategies

Alternative Platforms

• Entry Point: As low as INR 10,000 INR 1 lakh.
• Products: Unlisted equity, fractional real estate, etc.
• Note: Check lock-ins and tenures (typically 1-7 years).

DSP’s alternatives suite, which includes a range of funds based on different styles and exposure, offers sophisticated investment solutions designed to unlock new growth avenues beyond traditional assets. You can reach out to DSP RMs to figure out the best alternative for your requirements.

The risks that come with the upside

Alternative investments offer the potential for differentiated returns and diversification, but come with key trade-offs. Liquidity can be limited due to long lock-ins and fewer exit options. Transparency may vary, especially in less standardised or subjective strategies. Performance differs widely across managers access to top talent is critical. These products require deep due diligence, customised structuring, and a higher risk appetite. Ultimately, alternatives aren’t just about chasing returns they demand informed conviction and thoughtful risk-taking.

The bottom line

In a world of constant change, alternatives offer lasting potential not as a replacement, but as a smart complement to traditional assets.
No longer limited to institutions, they’re now for those ready to make their capital work harder, smarter, and with
purpose.

In the end, the most successful investors aren’t just those who make money.

They’re the ones who knew where to look before everyone else did.

Talk to the DSP team to know more about making the right investment choices.

¹ https://www.bonafideresearch.com/product/6405162406/india-collectibles-market
² PMS Bazaar
³ http://www.bain.com/insights/india-venture-capital-report-2025/
⁴ http://www.bain.com/insights/india-venture-capital-report-2025/
⁵ http://www.bain.com/insights/india-private-equity-report-2025/
⁶ http://ibef.org/news/indian-real-estate-investment-trusts-reits-distribute-rs-6-070-crore-us-709-million-in-fy25-u
⁷ SEBI data analysed by Eleveight