Guide to Mutual Funds
Module Units
- 1. Introduction: Mutual Funds
- 2. How Does a Mutual Fund Investment Work?
- 3. Different Types of Mutual Fund Schemes
- 4. How Can a Customer Invest in Mutual Fund
- 5. Fundamental Attributes of Mutual Fund Scheme
- 6. Types of Mutual Funds
- 7. Concept of AUM
- 8. Equity Mutual Funds
- 9. Debt Mutual Funds
- 10. Hybrid Mutual Fund
- 11. Solution-Oriented Schemes
- 12. New Fund Offer (NFO)
- 13. Offer Document
- 14. Types of Risk in Mutual Fund
- 15. Net Asset Value
- 16. How do mutual funds calculate the reserve for declaring dividends?
- 17. Expenses Charged on Mutual Funds
- 18. What is Dividend Distribution Tax & when it is Levied?
- 19. Debt Mutual Funds
- 20. What is Indexation?
- 21. Risk Return and Performance of Funds
- 22. Types of Risks in Popular Mutual Fund Schemes
- 23. Which Factors Affect the Returns in a Mutual Fund Schemes
- 24. Methods Used To Evaluate The Performance Of A Mutual Fund
- 25. Mutual Fund Structure and Constituents
- 26. Key Personnel of an Asset Management Company
- 27. What are the objectives of AMFI?
- 28. Must know Concepts and Terms
- 29. Facilities and services that the investors GetS
- 30. Mutual Fund Advisors
- 31. Types of Commission for Mutual Fund Advisors
- 32. Mutual Fund Frequently Asked Questions
- 33. What are the KYC requirements?
New Fund Offer (NFO)
What is an NFO (New Fund Offer) and how does it work?
Just like a public company offers its shares to the public via an Initial Public Offering (IPO), an Asset Management Company (AMC) offers units of the mutual fund to the public via a New Fund Offer (NFO) in the stock market.
The NFO is a process which attempts to raise capital to purchase securities for the mutual fund scheme.
The AMC prepares Offer Document (prospectus) for the NFO, and after getting permission from SEBI, decides a suitable time for launch in the market.
There are three relevant dates related to NFO -
Opening Date
It refers to the date on which the fund opens for subscription to the public.
Closing Date
It refers to the date on which the fund closes for subscription to the public.
Subscription Reopening Date
After the NFO is over, the scheme will be open for entry and exit as it will now be a listed fund. The date at which the fund becomes available for trading in the stock market is the subscription reopening date.
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