Friday, 5 January 2018

5 Best ELSS Tax Saving Mutual Funds to invest in 2018

5 Best ELSS Tax Saving Mutual Funds to invest in 2018

5 Best ELSS Tax Saving Mutual Funds to invest in 2018



Some of the ELSS tax saving mutual funds has given good returns in the last one year. Today, I will share 5 best ELSS tax saving mutual funds to invest in 2018. These ELSS tax mutual funds are shortlisted based on several key parameters.


What are ELSS Tax Saving Mutual Funds?

An ELSS (Equity Linked Savings Scheme) is an open ended diversified equity mutual fund that invests primarily in equity and equity-related products. The investment made in ELSS funds is eligible for tax exemption u/s 80C upto Rs. 1.5 lakh. ELSS tax saving mutual funds doesn’t just help you to save tax but also gives you an opportunity to grow your money. Since ELSS is an equity-based fund, the returns from these ELSS tax saving mutual funds reflect the returns from equity markets. ELSS tax saving mutual funds has a lock-in period of three years.



Why should you invest in ELSS Tax Saving Mutual Funds?

ELSS is one of the best investment options to save tax u/s 80C for an investment upto Rs. 1.5 lakh. ELSS Tax Saving Mutual Funds also gives you an opportunity to grow your money from the potential of equity market. The lock in period of an ELSS fund is much lower as compared to traditional tax saving instruments like PPF, NSC, and bank fixed deposits,. You have an option to choose for dividend option and get some gains even during the lock-in period. The dividends you earn are also tax free.

Also read: Best performing mutual funds of 2017


Disadvantages of ELSS Tax Saving Mutual Funds

1. Risk factor: ELSS tax saving funds invests primarily in equity and equity-related products, hence all the risks associated with equity investments applicable to ELSS.
2. Restriction on withdrawal: You cannot withdraw your funds before the completion of the mandatory lock in period of three years.

Also read: Benefits of SIP | Advantages of SIP

Shortlisting parameters

1. Fund Performance: These ELSS tax saving mutual funds shortlisted on the basis of 3-5 years performance.
2. AUM (Assets Under Management): Shortlisted on the basis of AUM. All the selected ELSS tax saving mutual funds here are higher in asset size – 1000 Cr or above.
3. Crisil Rating: Crisil rated these ELSS tax saving mutual funds as Rank-1, Rank-2, and Rank-3.
4. Value Research Rating: Value Research rated these ELSS tax saving mutual funds as 5 stars, 4 stars, and 3 stars.

On the basis of the above parameters, the 5 Best ELSS Tax Saving Mutual Funds to invest in 2018 are given below
Scheme Name
Returns in Percentage*
Crisil Rank (For quarter ended Sep 2017)
Value Research Rating (Out of 5)

1 Year
3 Years
5 Years


Reliance Tax Saver (ELSS) fund
45.65
13.89
22.56
3
3
Tata India Tax Savings Fund
44.06
18.26
21.4
1
5
Aditya Birla Sun Life Tax Relief 96
42.18
16.49
21.67
2
5
Axis Long term Equity Fund
37.03
12.44
22.5
3
4
DSP BlackRock Tax Saving Fund
35.3
15.94
20.31
3
4
*As on 4/1/2018 Data Source: Value Research Online

1. Reliance Tax Saver (ELSS) Fund

Scheme Name
Returns in Percentage*
Crisil Rank (For quarter ended Sep 2017)
Value Research Rating (Out of 5)

1 Year
3 Years
5 Years


Reliance Tax Saver (ELSS) fund
45.65
13.89
22.56
3
3
*As on 4/1/2018 Data Source: Value Research Online

The main aim of this ELSS fund is to generate long-term capital gains and invest in a stock portfolio predominantly in equity and equity related instruments. This fund has given a very good performance to the investors. The fund has generated a return of 45.65 per cent in the last one year. Last three and five years returns of this fund are 13.89% and 22.56% respectively. Value Research rates this ELSS fund as 3 Stars (Higher is better). Crisil ranks this ELSS fund as Rank-3 (Lower is better). The current NAV of this ELSS fund under the growth scheme is Rs 69.56.



2. Tata India Tax Savings Fund

Scheme Name
Returns in Percentage*
Crisil Rank (For quarter ended Sep 2017)
Value Research Rating (Out of 5)

1 Year
3 Years
5 Years


Tata India Tax Savings Fund
44.06
18.26
21.4
1
5
*As on 4/1/2018 Data Source: Value Research Online

The objective of the fund is to provide income distribution and / or medium to long term capital gains while at all times emphasising the importance of capital appreciation. The fund is suitable for investors who aim to seek capital appreciation opportunities in medium to long term horizon. This ELSS fund performed well and has given a return of 44.06% to the investors in the last one year. The fund has given a return of 18.26% and 21.40% in the last three and five years respectively. Value Research rates this ELSS fund as 5 Stars (Higher is better). Crisil ranks this ELSS fund as Rank-1 (Lower is better). The current NAV of this ELSS fund under the growth scheme is Rs 81.33.


3. Aditya Birla Sun Life Tax Relief 96

Scheme Name
Returns in Percentage*
Crisil Rank (For quarter ended Sep 2017)
Value Research Rating (Out of 5)

1 Year
3 Years
5 Years


Aditya Birla Sun Life Tax Relief 96
42.18
16.49
21.67
2
5
*As on 4/1/2018 Data Source: Value Research Online

The objective of this ELSS fund is to save tax while growing your money through equity investments. This ELSS fund is suitable for investors who are seeking long-term capital growth. This ELSS fund has been consistently performing well. The fund has given a return of 42.18% to the investors in the last one year. The fund has generated a return of 16.49% and 21.67% in the last three and five years respectively. Value Research rates this ELSS fund as 5 Stars (Higher is better). Crisil ranks this ELSS fund as Rank-2 (Lower is better). The current NAV of this ELSS fund under the growth scheme is Rs 32.20.

4. Axis Long Term Equity Fund

Scheme Name
Returns in Percentage*
Crisil Rank (For quarter ended Sep 2017)
Value Research Rating (Out of 5)

1 Year
3 Years
5 Years


Axis Long term Equity Fund
37.03
12.44
22.5
3
4
*As on 4/1/2018 Data Source: Value Research Online

The objective of the fund is to generate long term capital growth and invests in a diversified portfolio predominantly consisting of equity and equity related instruments. The scheme is suitable for an investment horizon of at least 3-5 years or more. This ELSS fund also has been consistently performing well and given a return of 37.03% to the investors in the last one year. Last three and five years returns of this fund are 12.44% and 22.50% respectively. Value Research rates this ELSS fund as 4 Stars (Higher is better). Crisil ranks this ELSS fund as Rank-3 (Lower is better). The current NAV of this ELSS fund under the growth scheme is Rs 41.59.

5. DSP BlackRock Tax Saving Fund

Scheme Name
Returns in Percentage*
Crisil Rank (For quarter ended Sep 2017)
Value Research Rating (Out of 5)

1 Year
3 Years
5 Years


DSP BlackRock Tax Saving Fund
35.3
15.94
20.31
3
4
*As on 4/1/2018 Data Source: Value Research Online

The main objective of this ELSS is to generate medium to long-term capital growth from a diversified portfolio that is substantially constituted of equity and equity related securities of corporates. This ELSS fund is also performing well and has given a return of 35.30% to the investors in the last one year. The fund has given a return of 15.94% and 20.31% in the last three and five years respectively. Value Research rates this ELSS fund as Stars (Higher is better). Crisil ranks this ELSS fund as Rank-3 (Lower is better). The current NAV of this ELSS fund under the growth scheme is Rs 48.63.


Disclaimer: This article is strictly for informational purposes only. ELSS tax saving mutual funds does not guarantee any returns. Past performance of an ELSS fund may or may not sustain in the future. Please consult a mutual fund advisor or a financial planner before taking any investment decision.

Also read: Equity Linked Saving Scheme (ELSS)
Also read: All about ELSS | Tax Saving Mutual Funds


Also read: Best Mutual Funds to invest in 2018
Also read: How to start a SIP?

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Best ELSS Tax Saving Mutual Funds to invest in 2018



1 comment:

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