INCOME TAX6 Sept 2026
A ₹10 mutual fund looks cheap. It isn’t. Why NAV can fool investors
Many investors think a fund at ₹10 is cheaper than one at ₹300. That's wrong. NAV has no bearing on returns. Two funds with identical portfolios but different NAVs give same returns. New fund offers launch at ₹10, making them look cheap. The illusion is strong for first-time investors. Judge funds by portfolio and performance, not unit price.
Key Statutory Highlights
- A fund's NAV has no bearing on returns; only the portfolio matters.
- New fund offers almost always launch at ₹10, which can make them look cheaper than established funds.
- Two funds with identical portfolios but different NAVs give the same returns for the same investment amount.
Actionable Advice for Taxpayers / Founders:Before choosing a mutual fund, ignore its unit price or NAV. Compare the fund's portfolio, consistency and track record instead.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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