Ch.7 · Total Expense Ratio Limits · easy
What is 'fractional units' in mutual fund investing?
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EXPLANATION
Unlike stocks (which must be purchased in whole numbers), mutual funds allot fractional units to three decimal places. If you invest ₹10,000 at NAV ₹33.25, you receive 10,000/33.25 = 300.752 units. This fractional allotment ensures the full investment amount is deployed at NAV without leaving any uninvested balance.
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