About NFO Fund
To launch a new NFO mutual fund in the stock market, the company which is registered with SEBI and AMFI Mutual Funds in India, the asset management company submits all the documents related to its scheme like SID, KIM, SAI to the market regulator. After getting approval, the newspaper is published to raise funds for its plan.
New NFO fund is also almost similar to Initial Public Offering (IPO).
When the AMC company brings its NFO offer, it gives its investor an opportunity to buy the units of the mutual fund at a price of about Rs 10 per unit.
These funds, both open-ended and closed-ended, are launched through new fund offer for a limited period, after which these mutual funds trade on the stock market NSE and BSE based on the net asset value (NAV).
Top Asset Management Company in India
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People also ask
Question 1: What are NFO funds?
Answer 1: NFO is like the IPO of mutual funds it’s the first time the public can invest in a new mutual fund scheme, usually at ₹10 per unit.
Question 2: Is NFO a good investment?
Answer 2: An NFO can be a good investment if it offers a new theme, has a strong fund manager, and fits your long-term goals. But be careful — not all NFOs are better than existing funds. Always compare before investing.
Question 3: What is 10 Rupees NFO?
Answer 3: A ₹10 NFO means you can buy units of a new mutual fund at just ₹10 each during its launch period. It’s the starting price before the fund begins regular trading.
Question 4: What is the risk in NFO?
Answer 4: An NFO is new, so you can’t see past performance. The strategy may not work as expected. Some NFOs are launched just to attract attention, not value.
Question 5: Is NFO better than IPO?
Answer 5: No they serve different purposes.
- IPO means buying shares of a company.
- NFO means investing in a new mutual fund.
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