The Indian mutual fund industry offers various investment avenues to the investor. In the recent AMFI data disclosure, we have seen that the folios of the fund of funds have increased. So let us just explore these funds.
A Fund of Fund(FOF) is nothing but a mutual fund scheme which invests in other equity, debt, gold or foreign mutual funds. These funds can invest either in domestic mutual funds or in international funds. These funds could be investing in separate schemes from the various categories such as equity, debt or gold or in a combination of these assets. When these funds invest in a foreign fund or offshore fund, they become an international fund.
Let us just look at some popular fund of funds