10 hrs ago
India’s Alternative Investment Market Could Reach $1 Trillion
India’s investors are starting to use more types of investments than just mutual funds and stocks.
These newer choices are called alternative investments.
They can include private companies, real estate, start-ups and special investment strategies.
Lakshmi Iyer believes this market could grow to $1 trillion in about five years.
Alternatives may help spread risk because different investments do not always rise and fall together.
However, they cannot make investing completely safe.
Some investments may keep people’s money locked up for five to 10 years.
Investors should therefore choose alternatives based on their goals, patience and ability to accept risk.
Lakshmi Iyer says India’s alternative investment market could reach $1 trillion within five years.
The market is currently valued at slightly under Rs 20 lakh crore, or about $200 billion.
Alternative investments can include structured credit, private equity, real estate and start-ups.
Iyer says alternatives may improve diversification but cannot eliminate market volatility or risk.
Investors should assess their objectives, liquidity needs, investment horizon and risk appetite before investing.
- Who
- Lakshmi Iyer, Group President–Investments at Bajaj Finserv and MD and CEO of Bajaj Alternates.
- What
- Iyer discussed the growth, uses and risks of alternative investments in India.
- Where
- India.
- When
- The market could reach $1 trillion within the next five years.
- Why
- Growing financial literacy, wealth creation, new investment strategies and demand for diversification are expanding interest in alternatives.
Key facts
- Current market size
- Slightly under Rs 20 lakh crore, approximately $200 billion.
- Five-year projection
- Iyer says the market could reach $1 trillion.
- Alternative assets
- Structured credit, private equity, real estate and start-ups.
- Typical investment horizon
- Private markets and start-ups may require commitments of five to 10 years.
- Investment thresholds
- Mutual funds may begin at Rs 5,000, PMS requires Rs 50 lakh, and AIFs typically require Rs 1 crore.
- Risk and volatility
- Alternatives may provide access to less-correlated assets, but no investment vehicle eliminates volatility or risk.
- AI in investing
- AI may support faster and sharper decisions, while requiring secure, enterprise-level risk management.
Sources
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