Re: i want to invest heavly , please suggest me ???
FOF funds normally invests heavily in a particular MF and hence their entry expense is normally nil. but the major disadvantage with FOF are that for taxation purpose they are equated with debt funds, hence u pay up to 30% short term capital gains and also liable to pay long term capital gains tax which is nil in case of Equity oriented fund.
Fund of funds has a higher cost as the expense is paid on the FOF and the fund it holds. Correct me if i am wrong but all FOF invest in there own fund house. So that loses the potential of maximizing returns.
FOF funds normally invests heavily in a particular MF and hence their entry expense is normally nil. but the major disadvantage with FOF are that for taxation purpose they are equated with debt funds, hence u pay up to 30% short term capital gains and also liable to pay long term capital gains tax which is nil in case of Equity oriented fund.