What’s unique about Quantum Equity Fund of Funds (QEFoF)? We’re not telling you to invest in it yet, but it’s a trivia question. The answer: It is the only remaining mutual fund scheme—specifically, a fund of funds (FoF) scheme—that invests its entire corpus in equity mutual funds and those that belong to other fund houses. But there was a time when a few other such schemes did the same as well. What happened to them and why did they wither away?
What is an FoF?
An FoF is a mutual fund scheme that invests in other mutual fund schemes. It works like this: you invest in a mutual fund because you don’t have the time, wherewithal and patience to go through individual companies’ financial statements and to understand their business dynamics to be able to successfully invest in their shares. Hence, you go to a mutual fund; your fund manager does the research and picks stocks and sectors to invest in.