Everyone is aware of the importance of an investment. They help in growing your wealth. Out of several investment options, mutual funds are a popular investment. There are several mutual funds available in the market. Every month new funds are launched, which are known as New Fund Offers (NFO). In this article, explore the NFOs in December 2023 and also learn about the pros and cons of investing in an NFO.
A New Fund Offer is like the launch day of a new investment opportunity, i.e., a mutual fund. It’s when a mutual fund introduces a new scheme to the public for the first time. During an NFO, investors can buy units of the new scheme at face value. NFOs typically have a fixed duration, known as the subscription period, during which investors can invest. Once the NFO period ends, the scheme reopens for regular buying and selling at the Net Asset Value (NAV), just like other existing mutual funds.
The working of an NFO involves investors subscribing to the units of the new scheme during the initial offering period. The fund manager then uses the pooled money to invest in various securities based on the scheme’s objective. After the subscription period closes, the NAV is calculated, and the scheme officially begins its operations.
Investors can enter or exit the scheme at the prevailing NAV after the NFO period. NFOs provide investors with a chance to get in on the ground floor of a new fund, offering potential benefits and risks associated with being part of an investment from its inception.
Scheme Name | Category | Type | Open Date | Close Date | Risk |
DSP Banking & Financial Services Fund | Equity-Sectoral/Thematic | Open Ended | November 20, 2023 | December 4, 2023 | Very High |
Kotak Healthcare Fund | Equity-Sectoral/Thematic | Open Ended | November 20, 2023 | December 4, 2023 | Very High |
Bajaj Finserv Balanced Advantage | Hybrid-Dynamic Asset Allocation or Balanced Advantage | Open Ended | November 24, 2023 | December 8, 2023 | High |
Union Childrens Fund | Solution Oriented-Childrens Fund | Open Ended | November 28, 2023 | December 12, 2023 | Very High |
WhiteOak Capital Large & Mid Cap Fund | Equity-Large & Mid Cap Fund | Open Ended | December 1, 2023 | December 15, 2023 | Very High |
Axis India Manufacturing Fund | Equity-Sectoral/Thematic | Open Ended | December 1, 2023 | December 15, 2023 | Very High |
Motilal Oswal Small Cap Fund | Equity-Small Cap Fund | Open Ended | December 5, 2023 | December 19, 2023 | Very High |
Samco Dynamic Asset Allocation Fund | Hybrid-Dynamic Asset Allocation or Balanced Advantage | Open Ended | December 7, 2023 | December 21, 2023 | Very High |
Here are a few limitations of investing in an NFO, and investors must analyse these along with the benefits and conduct thorough research before making investment decisions.
While New Fund Offers present unique opportunities, investors should approach them wisely, considering both advantages and limitations. For those keen on exploring investment opportunities, open a Demat Account on Angel One today.
Disclaimer: This article has been written for educational purposes only. The securities quoted are only examples and not recommendations.
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