NFOs, a complex mutual fund product! - A tough nut to crack
Well, I am always looking for some good theme to write on. Have not written much off late on Personal Finance and Mutual Funds. Of course, I am only, at the most, a mutual fund enthusiast, who knows a bit more than many ill-informed or semi-informed people out there. One school of thought believes that NFOs (New Fund Offers) are useless bets. When you have so many existing schemes, why to go for a new scheme. While you have some historical data points and qualitative information (for example, the profile of the fund manager) to judge an existing scheme, not much is available on NFOs. The only thing you have is A BEAUTIFUL SALES PITCH. I also happen to belong to this school of thought (a thorough loyalist, even the same applies to IPOs, but we will talk about it later sometime). Let us start with the data of one recent NFO of HDFC Multicap Fund, derived from moneycontrol on 27 Dec, 2022. While the figures are not much legible, the graph clearly shows that the fund has beaten its benchm