NFO stands for New Fund Offer, refer to the new scheme offered by AMC (Asset Management Company) in the market to fund their capital. NFO works similarly to the IPO (Initial Public Fund), but the investor in NFO offers the public to invest at offer prices generally fixed at INR 10 and at a limited time only. As NFO is new funds scheme in the market, it cost cheaper and allows people to buy the shares before it gets listed on the stock exchange. With the fundraises through NFO, the company buys securities — bonds, equity shares, etc.
Before investing in NFO shares, it is advisable that investors read about the company history of the last 5–10 years to ensure the investment of NFO will have a good performance in the future. It is critical to know the performance of the company during market fluctuation.
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