An abridged offer document, which contains very useful information,
is required to be given to the prospective investor by the mutual fund.
The application form for subscription to a scheme is an integral part of
the offer document. SEBI has prescribed minimum disclosures in the
offer document.
An investor, before investing in a scheme, should
carefully read the offer document. Due care must be given to portions
relating to main features of the scheme, risk factors, initial issue
expenses and recurring expenses to be charged to the scheme, entry or
exit loads, sponsor’s track record, educational qualification and work
experience of key personnel including fund managers, performance of
other schemes launched by the mutual fund in the past, pending
litigations and penalties imposed, etc.