Alternative Investment Funds (AIFs) are a type of pooled investment fund that invests in a variety of assets, including venture capital, real estate, private equity, hedge funds, and managed futures. In other words, an AIF is a sort of investment that is separate from standard investing options like stocks, bonds, and other debt securities.

Alternative Investment Funds [AIF] are not regulated by any Indian regulatory entity and are not classified as mutual funds under the SEBI's mutual fund legislation. Under Regulation 2(1) (b) of the SEBI (Alternative Investment Funds) Regulation, 2012, AIFs are described as a “privately held and managed pool of investment fund of either domestic or foreign origin, organised in the form of a body corporate, company, LLP (limited liability partnership), or trust.” An AIF can be created using any of the forms listed above.

AIFs are private pooled investment funds that cannot be purchased through public offerings (such as Initial Public Offerings) or other collective investment schemes, such as Mutual Funds.