What is an open ended mutual fund (MF)?
Open ended MFs are more common compared to close ended MFs. In open ended MFs, the fund house continuously buys and sells units from investors. New units are created and issued if there is demand, and old units are eliminated if there is redemption pressure. There is no fixed date on which the units would be permanently redeemed or terminated. If you want to invest in an open ended fund, you buy units from the fund house. Similarly, when you redeem your units, the fund house directly pays you the value of the units.
