Q. With reference to Alternative Investment Funds (AIFs) in India, consider the following statements:
1.AIFs are regulated by the Reserve Bank of India under the Banking Regulation Act, 1949.
2.AIFs are privately pooled investment vehicles that typically cater to high net-worth individuals and institutional investors.
Which of the statements given above is/are correct?

[A] 1 only

[B] 2 only

[C] Both 1 and 2

[D] Neither 1 nor 2

Answer: B
Notes:

Explanation:

  • Statement 1 is incorrect: AIFs are regulated by SEBI, not RBI, under the SEBI (Alternative Investment Funds) Regulations, 2012.
  • Statement 2 is correct: AIFs are privately pooled investment vehicles, typically meant for sophisticated investors, such as HNIs and institutional investors.

Source- TH

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