Let’s understand about what is NFO ? and the upcoming NFO Investment Opportunity for the Investors in September 2020 also the Methods by which they can Invest.
NFO- New Fund Offer is a Process to collect Capital from the Investors. Usually, NFO is Launched when the Fund House -AMC comes with a New Idea or Concept in the Market. Through such offers, investors can purchase units of a mutual fund at the subscription price, usually set at Rs.10 per unit. Both open-ended and closed-end funds are launched via new fund offers for a limited period, after which such mutual funds are traded in the market based on their corresponding net asset value (NAV).
As per SEBI Guidelines, A NFO is available for subscription maximum for 30 days. The initial Offer price to the Investors is Rs. 10, & the Collected fund is further invested in the Securities described in the Offer Documents of the NFO according to its objective and SEBI Regulations.
Types of NFOs are available: –
1. Close-ended funds
These types of Funds are available for a Limited corpus and to the Limited no of Investors. Once the Subscription Period is over, the Investors have to wait for the closing period to over for redemption or the Investor can sell the Units through stock exchange on the Prevailing NAV.
2- Open-ended funds
Open-ended funds are those types of Funds where there is no limit of the Units and the Investors. Most of the Mutual funds are usually are Open-Ended Funds and units are available at pre-determined NAV of Rs. 10 and can be Redeemed anytime as the Fund opens for subscription post listing.
How NFO is a Good Opportunity?
The AMCs use NFO to raise money from the Investors to Purchase the NAV on the Cheaper rate @Rs. 10 as it is first to offer in the Market. Usually, each NFO comes with a New objective or Idea, and an investor can find good investment opportunities if the Fund objective matches with their Investment Objectives. NFO can be available for Equity Funds as well as Debt Funds also.
Do Research Properly before investing as just not the cheaper NAV and other parameters also matter if it comes to Investment of your Hard Earned Money.
How to Invest in an NFO?
There are two ways through which one can invest their money in NFO. Investing in NFO is overall a seamless process and one can choose any one of the below-mentioned methods for investment in NFO.
Offline Method: – One Can Invest in NFO through any MF distributor by filling the form and giving the Cheque. It is as Simple as Buying any other Mutual Fund but there your KYC must be Completed before the Actual Investment.
Online Method: – You Can Also Buy the NFO through Various Mobile Applications available in the Market, Through AMCs websites, through the online Platform available of NSE & BSE, Through the Distributors website, etc. Online methods are equally sophisticated and smooth like offline methods. You can make the payment through Online Banking, Debit Card, One Time Mandate, RTGS, etc.
Recommended Mobile Application for NFO Purchase- https://play.google.com/store/apps/details?id=com.trinityinvestcon&hl=en_US
Upcoming NFO & Their Objectives
NFO 1- Axis Global Equity Alpha Fund of Fund(G)
Company Axis Asset Management Company Ltd.
Scheme Name Axis Global Equity Alpha Fund of Fund(G)
Scheme Type Open ended scheme
Fund Manager Hitesh Das, R. Siva Kumar
Category FoFs (Overseas)
Initial Offer Price 10
Minimum Investment 5000
Additional Investment 100
Objective To provide long term capital appreciation by predominantly investing in Schroder International Selection Fund Global Equity Alpha, a fund that aims to provide capital growth by investing in equity and equity related securities of companies worldwide. The Scheme may also invest a part of corpus in debt, money market instruments and / or units of liquid schemes in order to meet liquidity requirements from time to time.
Max Exit Load% 0
Option Type Dividend, Growth
INVESTMENT PATTERN Units / shares of Schroder International Selection Fund Global Equity
Dates Open 04-Sep-2020 Close 18-Sep-2020
NFO-2 Invesco India Focused 20 Equity Fund
Company Invesco Asset Management Company Pvt Ltd.
Scheme Name Invesco India Focused 20 Equity Fund
Scheme Type Open ended scheme
Benchmark Index S&P BSE 500 – TRI
Fund Manager Taher Badshah
Category Equity – Focused Fund
Initial Offer Price 10
Minimum Investment 1000
Additional Investment 1000
Objective To generate capital appreciation by investing in up to 20 stocks across market capitalization.
Option Type Dividend, Growth
INVESTMENT PATTERN Equity & Equity Related Instruments Min 65 Max 100
Dates Open 09-Sep-2020 Close 23-Sep-2020
NFO 3 Mirae Asset Equity Allocator FoF(G)
Company Mirae Asset Investment Managers (India) Private Limited
Scheme Name Mirae Asset Equity Allocator FoF(G)
Scheme Type Open ended scheme
Benchmark Index NIFTY 200 – TRI
Fund Manager Bharti Sawant
Category FoFs (Domestic) – Equity Oriented
Initial Offer Price 10
Minimum Investment 5000
Additional Investment 1000
Objective The investment objective of the scheme is to provide long-term capital appreciation from a portfolio investing predominantly in units of domestic equity ETFs. There is no assurance that the investment objective of the Scheme will be realized.
Max Exit Load% 0
Option Type Dividend, Growth
INVESTMENT PATTERN Units of Domestic Equity ETF Min 95 Max 100
Dates Open 08-Sep-2020 Close 15-Sep-2020
Our Recommended NFO- Invesco India Focused 20 Equity Fund
Mutual Fund Investment are subject to market Risk. We are neither involved in any Distributor services nor RIA. All the View Are Personal.