There are times when mutual funds restrict the investments into a particular scheme. This usually happens in case of small and mid cap funds where the fund manager is not able to find adequate opportunities for investments. If there is a bull run in these stocks then it becomes very difficult for the fund manager to keep deploying the funds that continue to pour into the scheme. In this case the fund house is forced to put a stop to the investments by restricting the new purchases that investors can make into these funds. This can mean a time of worry for existing investors but here is a manner in which they can look at the entire situation. Protection Existing investors need not worry about any such restrictions that they witness in terms of new investments into the scheme. This is because the step is actually for their protection. If the fund house continues to allow the money to pour in then they would be forced to buy holdings at the high valuations that are present.
