• Better diversification possibilities: Invest in much wider asset classes including unlisted equity, debt, derivatives – providing better risk management possibilities.
• Leverage: Can be leveraged up to 2X for better risk adjusted returns.
• Professional management: Active investment decisions based on thorough business understanding.
• Taxability: Tax is assessed and paid at AIF Scheme level.
• Better governance: Comprehensive SEBI regulations, offering transparency and better investor protection.

Category III AIFs invest in securities of listed as well as unlisted investee companies, derivatives, complex or structured products, or other AIF units. These can be open-ended or closed-ended funds. For a closed-ended fund, the minimum tenure is three years.