With the help of an NFO, the fund house raises money from the public to purchase securities such as equity shares, bonds, and so on, in the market. NFO is cheaper than the existing funds as it is new to the market. They are comparable with the Initial Public Offering (IPOs) in which the public can purchase shares before getting listed on the exchange. Also, a whole range of marketing efforts that go into their promotion makes it a too-good-to-miss opportunity. However, sometimes, you need to put in your judgment and wisdom before settling for one.