NFO MUTUAL FUND SCHEMES
OPEN AND CLOSE-ENDED NEW FUND OFFER SCHEMES
AMCs offer new NFO mutual fund schemes as open-ended and close-ended schemes. Open-ended NFO is a perpetual kind of fund. Thus, once the new mutual fund is launched it continues to exist without an end date. However, closed-ended NFO funds come with a fixed duration such as 3 years, 5 years, and 7 years. Investors can buy open-ended funds anytime.
They can invest even after the closure of the new fund offer. However, you can invest in a close-ended fund only during the offer period. Once the offer period elapses, you cannot invest into close-ended funds. Open-ended funds are generally considered more investor friendly as they offer anytime investment and redemption compared with close-ended funds. NFO investment has become a online investment option for many investors largely because its Net Asset Value (NAV) is priced at Rs. 10 per unit, compared with other open-ended schemes that have a higher NAV.
Disclaimer : *investment in securities market are subject to market risks, read all the related documents carefully before investing