Mutual Fund NFO: When a company lists its shares on the stock exchanges, before that it comes with an IPO. This is the initial sale of shares. Thus, when a mutual fund house comes up with a new scheme, it first comes out with a New Fund Offer (NFO) for that scheme. People invest in NFO period. It is then available for investment in the normal way. Now a fund house has come up with a new scheme. Know its details.
NFO of Mahindra Manulife Mutual Fund
Mahindra Manulife Mutual Fund has announced the launch of a new Small Cap Fund, which is an open-ended equity scheme. Small Cap scheme predominantly invests in small cap stocks. This is Mahindra Manulife Small Cap Fund. Its New Fund Offer has opened on November 21, 2022 and will close on December 5, 2022. The scheme will re-open for continuous sale and repurchase (i.e. normal sale and purchase) from 14th December 2022.
better for whom
The Asset Management Company (AMC) said in a statement that this scheme would be better for investors who want to earn money over the long term and want to invest mainly in equity and equity related securities of small-cap companies. Mahindra Manulife Small Cap Fund will be managed by Abhinav Khandelwal and Manish Lodha.
more focus on equity
According to the AMC statement, the scheme will focus on creating a diversified portfolio of companies for the long term. The scheme will invest a minimum of 65% of the net assets in equity and equity related instruments of small cap companies. That is, out of the amount of funds that will come to the scheme, 65 percent will be invested in the equity segment.
Investment in Equity Derivative Instruments
The scheme can invest in equity derivative instruments up to 50% of the permitted investment in equity (65%). Investment in derivatives will be for hedging, portfolio balancing and such other purposes as may be subject to regulations and guidelines issued by SEBI/RBI from time to time.
This is the target of the fund
Speaking on the NFO, Anthony Heredia, MD & CEO, Mahindra Manulife Mutual Fund said that the Indian economy is poised to become one of the leading economies of the world in the coming decade. This can create huge opportunities in many sectors and businesses, many small companies can use this potential to become huge over time. He said that small cap funds can be a good option for long term investors who want to take advantage of this change and should become a core part of investors portfolio. Krishna Shanghvi, (Chief Investment Officer – Equity, Mahindra Manulife Mutual Fund) said, The investment objective of the fund is to create long term wealth by investing in a diversified portfolio of equity and equity related securities of small cap companies. He added that valuation wise, small caps currently provide a good opportunity for investors looking to build a long term equity portfolio.