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What are New fund offers (NFO)

What are New fund offers (NFOs)

This article attempts to bring out light to the benefits of investing in NFO.

What are NFOs?

New Fund offer is the primary subscription offer of a scheme to the public by the Asset Management company. New Scheme is launched by an Asset management company when it is able to deliver a product which is different from the existing ones. NFO provides an opportunity to invest in something new for the investors. Here the money collected by the mutual fund house is invested across various instruments in line with the investment objectives of the scheme’s.

NFOs are open for subscription for a limited number of days for the investors. Investors can buy or sell units of an open-ended scheme on an ongoing basis even after the NFO period is over. In case of closed ended schemes a new investor cannot enter directly with mutual funds but can enter through the stock exchange after the NFO period.

Factors to evaluate before investing in NFOs

Investor must invest in an NFO if the objective of the scheme are in line with their goals and risk-bearing appetite. Investor must evaluate the asset allocation pattern and the recurring expenses and exit load from the scheme’s information document. As there is no historical record for NFO, it is essential to check the fund manager’s experience & qualifications.

Mutual Fund investments are subject to market risk and the Investors should consider their investment objectives and risks carefully before investing & must read all scheme related document carefully

MF Invest India is registered with AMFI under ARN code: ARN144789

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