What is NFO in Zerodha? How to invest in it?

Short Answer

NFO in Zerodha is the abbreviation of "New Fund Offer". It refers to the introductory offer of a scheme by an AMC (Asset management company). An NFO is raised when a fund is launched and this will help the firm to raise capital for purchasing securities. 

Detailed Answer

Now, you know the meaning of NFO, let's discuss in detail about this concept of New Fund Offering.

Types of NFO or New Fund Offers:

Basically, there are two types of NFOs depending on the structure of the scheme:

1. Open-Ended

This fund gets officially launched after the NFO period expires. Investors can enter and exit the funds at any time after the launch. 

2. Close-Ended

In this fund, investors are not allowed to enter and exit after the NFO period, until its maturity and typically this period is for 3-4 years from the launch date.

NFO in Zerodha:

Zerodha investors have the opportunity during a New Fund Offer to purchase units of the scheme at their face value, which is ₹10 per unit. Only within a limited period investors can subscribe to an NFO, say fifteen day or a month. Thus, new fund offers are functional on a first come first serve basis. Once the NFO period expires, interested investors shall be able to take exposure only at the prevailing NAV. 

Since New Fund Offer is restricted to a confined time frame, units are allotted to the investors in the order of their application. 

How do you invest in NFO with Zerodha?

Following are the steps to invest in NFO with Zerodha:

1.Investment in New Fund Offer will be not available on Coin app. For place order you have to visit this webpage coin.zerodha.com in your mobile browser. 

2.After login, hover the cursor on your client ID which is right side on the top, you will find multiple options. You can click on NFO (New Fund Offer).

3.You will be able to see the open order window for NFO.

4.You can fill in the ‘Amount to Invest’ section to place the order.  

NFO in Zerodha: Key Points to Note

1.The minimum purchase of an NFO is decided by the AMC only. 

2.After placing the order, Zerodha allows you to modify the amount from the order window on the NFO page. 

3.If you wish to start SIP while applying for an NFO, you can't do so. But, when the units are allotted to you and after the scheme is open for further redemption and purchase then only you can initiate a SIP.

Where can you track the status of NFO order?

You can track the status of your order on the NFO page, status will not shown under the order history on mobile app or Zerodha Coin web until allotment. Normally, NFO period is open for 15 days only, however it is upon the discretion of the fund house. You will also receive the confirmation email regarding the allotment. 

When Will the funds be deducted for your order?

Throughout the NFO period they collect the orders and upload all the orders on the final day of the NFO period. However, you have to maintain sufficient funds in your registered account as of the last day of the NFO.

When can you buy the units if you miss applying for the NFO?

Similar to other funds buying and selling the units gets easy when the funds are opened for continuous purchase. Normally, funds are made available for continuous purchase within 7 days of the NFO closing. 

Zerodha India's largest online stock broking company has upgraded its technological infrastructure. It always offers the right products to the audience in different segments and NFO is one of them. What do you think about it? Managing a massive client base isn't that easy, but Zerodha is definitely doing it well.

Tagged With: Zerodha ReviewZerodhaNFO in ZerodhaZerodha NFONFONew Fund Offer
Ask Your Query for FREE, Get quick answers from our FINTRAKK community!
Discussion (1)

NFO in Zerodha means ‘New Fund Offer’. An NFO is the first time when a fund is offered for subscription by an AMC (Asset management company). If you wish to place an order you have to visit on this webpage coin.zerodha.com in your mobile browser.

Related FAQs
What is Fincash Review? Login and invest in SIP in Mutual funds

Fincash is a yet another online investing platform that was started in 2016 or you can call it a fintech startup. Having raised funding, it has grown fast to give tough competition to other market players.

What is Mirae Asset FANG Plus ETF?

The Mirae Asset NYSE FANG Plus ETF Fund is a good option for Investors who want foreign exposure. The Equity allocation is very concentrated to just 10 stocks which makes this ETF very volatile and risky. This ETF consists of the top 10 stocks in their respective sectors mostly TECH, like Amazon, Netflix. Facebook, etc. Hence Investors with high-risk tolerance and a long time period should consider this fund.

Which is better Zerodha or Groww for Mutual Funds?

Zerodha as well as Groww, both allow investors to invest in Mutual funds. Groww does not charge any Account opening fees or Annual maintenance Charges but Zerodha charges Rs 200 for Account opening and Rs 300 for AMC. This makes Groww a cheaper and better option when it comes to investing in mutual funds.

What is Electric Mobility Smallcase and How to invest in it? Review

The Electric Mobility Smallcase is a basket of stocks that are selected by Smallcase based on the goal of the Government to achieve the sale of 60-70 Lakh hybrid & electric vehicles from the year 2020. The pros & cons are evaluated of the sector and the features of this smallcase are discussed below.

Which is better Zerodha or Groww for stocks?

Zerodha and Groww are both good players in the Discount Broking space but both have some differences. Zerodha has the largest client base and is the most trusted Broker in India whereas Groww is one of the fastest-growing Discount brokers. Both offer different features to their clients which is discussed in detail below.

Who is the No.1 Stock Broker in India?

When talking about the best stock broker in India, we cannot rule out Zerodha. It is the market leader in bargain stockbroking, is premised in Bengaluru, and accounts for more than 15% of total retail trading activity in the country. Mr. Nitin Kamath formed the leading brokerage firm in 2010 Kamath, and it now has a customer base of over 6 million.

Is Zerodha better than Interactive Brokers?

Interactive Brokers & Zeodha are two Brokers from the Discount Broking community but both are quite different from one another in terms of Features and Working. One is an Indian discount Stock Broker whereas the other is a U.S based Discount broker that has its branches in many countries. Let's look at them in depth below.

Which is best 5paisa vs Zerodha stock broker?

You might have read about different stock brokers in India. Here I'll review two of the most popular discount brokers in India: 5Paisa v/s Zerodha Comparison.

Is Groww App Safe for Mutual fund and Stock Investing?

Yes, Groww app is completely safe for mutual fund, stock investing and trading. As a popular mutual fund investment plaftorm, Groww established itself quite well in the past few years. Now, it has also enetered the stock broking space so it's really good to see new entrants amid existing top discount brokers in India.

What are the highest paying jobs in Finance sector in India?

Financial sector has huge potential when it comes to careers. The pay is more influenced by experience and specialization, and once you have experience, your earning potential is unbounded.