The world of investing is changing rapidly. High-net-worth individuals (HNIs) and NRIs today are moving beyond traditional equity and mutual funds to explore private market opportunities like unlisted shares, PMS, and AIFs. However, to ensure that growth is sustainable, these high-risk assets need to be balanced with the stability of bonds and other fixed-income investments.
If you’re exploring how to invest in unlisted shares in India, comparing unlisted shares vs listed shares returns, or thinking about whether to invest through PMS vs AIF vs mutual funds, you’re already on the right track.
At Rurash Financials, we believe smart investing is knowing how to blend high risk and safety instead of choosing between one of them. A portfolio that mixes unlisted shares, PMS, and AIF (for high-growth opportunities) with bonds (for stability) can create a strong, risk-adjusted strategy that grows confidently and sustainably.
Why Diversification Matters Today
India’s investment landscape has evolved quickly. The rise of private markets and new wealth vehicles has opened up fresh opportunities for investors.
In the last two years, unlisted shares — especially pre-IPO shares of well-known companies — have seen growing demand. According to market data, unlisted shares tracked through the NSDL index surged by almost 40% over two months, showing strong investor interest (Business Today).
At the same time, Portfolio Management Services (PMS) and Alternative Investment Funds (AIFs) have emerged as powerful tools for HNIs who want professional management and access to diversified, high-return opportunities.
But here’s the key insight:
- Unlisted shares and PMS/AIF are both high-growth, high-risk
- The difference is that unlisted shares are concentrated bets (you invest in one or two companies), whereas PMS/AIF are diversified and professionally managed.
- To truly stabilize such portfolios, investors must include bonds or fixed-income instruments, which provide steady income and protect against market volatility.
So, the real balance is not between unlisted shares and PMS/AIF — it’s between high-risk growth assets and low-risk income assets.
Key Components of a Diversified, Risk-Adjusted Portfolio
Let’s break down the main investment types that can together create a risk-aware, growth-oriented portfolio.
1. Unlisted Shares – High Potential, High Concentration Risk
When you invest in unlisted shares in India, you’re buying shares of companies that aren’t yet listed on the stock exchange. These could be startups, pre-IPO firms, or private companies with promising growth potential.
Why investors like them:
- Access to high-growth companies before
- Early investment often means higher potential returns after listing.
- They offer diversification beyond traditional markets.
But remember:
- Unlisted shares are illiquid — selling them can take time.
- Valuations are not always transparent.
- There’s concentration risk — your money is tied to the success of a few companies.
Experts estimate that unlisted shares can outperform listed shares by 2–3% over time, though this comes with higher risk (Stockify).
2. PMS (Portfolio Management Services) – Diversified Professional Management
PMS allows investors to have a personalized, actively managed portfolio run by professional managers. It’s suitable for those who want more flexibility and tailored investment strategies than mutual funds can offer.
Key points:
- The minimum investment in PMS in India is ₹50 lakh (5paisa).
- PMS managers invest across different sectors, companies, or themes — spreading the risk.
- It still carries equity-like risk, but offers disciplined, research-backed management.
Unlike unlisted shares where your exposure is to a single company, PMS spreads your investment across multiple opportunities, making it less concentrated. Follow this guide to learn how to select the best portfolio management service for your financial goals.
3. AIF (Alternative Investment Funds) – Structured High-Growth Vehicles
AIFs are privately pooled investment funds regulated by SEBI. They raise money from sophisticated investors and deploy it into different asset classes — such as private equity, venture capital, real estate, or special opportunity funds.
Why HNIs prefer AIFs:
- Access to unique, high-return opportunities unavailable in public markets.
- Professional management and regulatory oversight.
- Diversification across sectors, startups, or even distressed assets.
However, AIFs are not low-risk instruments — they’re still part of the “high-risk, high-return” category. Their advantage lies in diversification and expert due diligence.
Investors must meet SEBI’s eligibility criteria and commit to a longer investment horizon due to lock-in periods (Bajaj Finserv).
4. Bonds – The True Stabilizer
While unlisted shares, PMS, and AIFs aim for high returns, bonds play a different but equally crucial role: stability.
Bonds offer:
- Regular interest income.
- Lower volatility compared to equities.
- Liquidity (especially listed bonds).
Listed bonds are safer and more transparent, while unlisted bonds may offer higher yields but carry more credit and liquidity risk (LiveMint).
In 2025, the best bonds to balance a portfolio in India are those issued by reputable corporates or government bodies, with strong credit ratings and moderate duration.
How It Works – Creating a Smart Diversification Mix
To build a truly risk-adjusted portfolio:
1. Define your goal and time horizon.
Decide how long you want to stay invested and what you want to achieve — growth, income, or wealth preservation.
2. Segment your portfolio:
- Growth layer (60–70%): Unlisted shares + PMS + AIF
Aim: Higher long-term growth, managed volatility. - Stability layer (30–40%): Bonds or fixed income
Aim: Regular income and risk cushioning.
3. Follow due diligence.
Choose unlisted shares only after proper research. Select PMS/AIFs with proven track records and SEBI registration.
4. Ensure compliance.
Follow RBI and SEBI norms for unlisted and alternative investments. Keep all transactions documented.
5. Review periodically.
Rebalance your portfolio at least once a year to realign with your financial goals and risk tolerance.
Returns, Taxation & Benefits
Expected Returns
- Unlisted shares vs listed shares returns: Unlisted shares can potentially earn higher returns (2–3% more), but the outcomes depend heavily on company performance and timing (Stockify).
- PMS/AIF: Offer professional alpha generation but involve fees and longer lock-ins.
- Bonds: Provide stable, lower-risk returns through fixed coupons.
Taxation
- Unlisted shares: Long-term capital gains (after 24 months) taxed at 12.5% without indexation (RRFinance).
- Bonds: Interest taxed as per income slab; capital gains depend on holding period.
- PMS/AIF: Tax depends on the underlying asset class (equity, debt, or hybrid).
Key Benefits
- Reduced concentration risk through professional management (PMS/AIF).
- Stable income flow via bonds.
- High-growth participation through unlisted equity.
- Long-term risk-adjusted wealth creation.
Risks to Keep in Mind
Every investment involves risk, but awareness and allocation can reduce its impact.
- Market & valuation risk: Unlisted shares and AIFs can fluctuate in value with limited price transparency.
- Liquidity risk: Unlisted shares and AIFs often have lock-ins or limited exit options.
- Credit risk (in bonds): Avoid unlisted or lower-rated bonds unless yield justifies the risk.
- Fee structure: PMS and AIFs charge management/performance fees.
- Regulatory caution: Always invest through SEBI-registered platforms or advisors.
Remember: PMS and AIF don’t eliminate risk — they distribute it. Only fixed income truly stabilizes it.
How Rurash Financials Adds Value
At Rurash Financials, we help investors create portfolios that grow steadily and stay compliant. Our expertise lies in helping you combine growth, diversification, and stability in a single strategy.
Here’s how we help:
- Identify suitable portfolio diversification with unlisted equity based on your goals.
- Source and vet high-quality unlisted shares through trusted, compliant channels.
- Recommend the best PMS and AIF options tailored for your investment horizon.
- Balance your portfolio with the best bonds to invest in India 2025, matching your liquidity and safety needs.
- Provide transparent reporting, performance tracking, and regulatory guidance throughout your journey.
Our aim is simple — to help you build a portfolio that grows confidently and sustains through every market cycle.
Conclusion
True wealth creation doesn’t come from chasing returns — it comes from building structure.
By blending high-growth investments like unlisted shares, PMS, and AIF with stable income sources like bonds, you can create a portfolio that not only grows faster but also weathers volatility with confidence.
If you’re ready to explore how this can fit your goals, connect with the Rurash Financials team. Our experts can help you design a strategy that’s insightful, compliant, and built for the long term.
FAQs
1. Why include Unlisted shares in a portfolio?
They offer access to high-growth private companies before IPO, giving potential for higher long-term returns.
2. How do bonds help manage risk?
Bonds provide stable returns and act as a cushion against market volatility.
3. What is the minimum investment in PMS in India?
The minimum is ₹50 lakh. PMS provides professional management and diversification (5paisa).
4. Are AIFs suitable for HNIs?
Yes, AIFs allow HNIs to access private equity, venture capital, and real asset opportunities.
5. How do PMS and AIF differ from mutual funds?
They are more customized, less liquid, and aimed at sophisticated investors with higher minimums.
6. Can investors combine unlisted shares, PMS, and bonds?
Yes — this combination helps spread risk and create a diversified portfolio.
7. What’s the return difference between unlisted shares and bonds?
Unlisted shares can yield higher returns (2–3% more) but with higher risk; bonds are safer and steady.
8. How to build a risk-adjusted portfolio with these?
Allocate part of your portfolio to unlisted shares, part to PMS/AIF, and part to high-quality bonds.
9. Are unlisted shares riskier than PMS/AIF?
Generally yes, because PMS and AIF spread risk across multiple holdings, unlike direct unlisted equity.
10. What role do bonds play here?
They are the stabilizer — generating predictable income while balancing volatility.
11. How can HNIs mix these for long-term wealth?
By combining the growth of private equity with the safety of debt — using professional oversight.
12. What are the tax implications?
Unlisted shares: 12.5% LTCG (after 24 months). Bonds: taxed per slab. PMS/AIF: based on underlying assets.
13. Which is easier to liquidate — AIF or unlisted shares?
Both are illiquid. AIFs have defined exit timelines; unlisted shares depend on finding a buyer or IPO.
