NFO (New Fund Offer)

When an asset management company launches a new mutual fund in the market, they can secure capital by initiating a New Fund Offer (NFO). This concept shares similarities with an Initial Public Offering (IPO). NFOs include comprehensive details about the fund's portfolio, encompassing aspects such as the acquisition of company shares, the types of securities to be procured, the appointed fund manager, and more.

Through these NFOs, investors have the opportunity to acquire mutual fund units at the subscription price, typically set at Rs. 10 per unit. Both open-ended and closed-end funds are introduced through NFOs for a limited period. Subsequently, these mutual funds are traded in the market based on their respective Net Asset Values (NAVs).