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Closed-end funds give fund managers time to perform

In the absence of redemption pressures, they can pick multi-baggers . But, investors have to reconcile themselves to lower liquidity

Sanjay Kumar Singh 

Investing in new fund offers (NFOs) is always fraught with risks. So, a fund with a closed-end structure that invests in the micro-cap category is to be viewed carefully. The new fund offer of Sundaram Long-Term Microcap Tax Advantage Fund Series III, a closed-end scheme, is currently on (closing on November 11).

This fund will invest in stocks that rank 301 and below by market cap on the National Stock Exchange. A tax-saver fund, it will allow investors to avail of tax deduction under Section 80C. The good: The micro-cap space offers scope for identifying multi-baggers. To cite a ...

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First Published: Mon, August 22 2016. 23:10 IST