Leverage
What is Leverage in an Indian AIF?
Leverage is exposure taken beyond a fund’s own capital, through borrowing or derivatives. Category II AIFs may not use it except for short-term operational needs. Category III AIFs may use leverage subject to SEBI limits and disclosure, which is the defining difference between the two categories.
Authority: SEBI (Alternative Investment Funds) Regulations, 2012
Related terms
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Definitions are explanatory, not legal advice. Where a definition rests on a regulation or circular it is named above; verify against the instrument before relying on it.