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I am doing SIP in Axis Long Term Equity Fund for saving tax. Shall I continue the SIP in it?

Is Axis Long Term Equity Fund a good fund? Any other other suggestion for ELSS funds?

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2 Approved Answers

Pijush Kanti Biswas

Axis Long Term Equity Fund is an Equity Linked Savings Scheme (ELSS). which not outperformed its benchmark since last 1 year.

ELSS is a dedicated mutual fund scheme that allows investors to save tax. It also provides an opportunity for long term capital appreciation. An ELSS fund manager invests in diversified portfolio, predominantly consisting of equity and equity related instruments that carry high-risk and have the potential to deliver high-returns.

Key points for Axis Long Term Equity Fund are:

  • This fund has been rated as a 3-star fund by Groww and has been ranked 3 in ELSS category by CRISIL (for quarter ended Sep 2017)
  • AUM of close to ₹15223 Cr.
  • Asset under management(AUM) is more than ₹10000 Cr. Returns tend to go low once AUM exceeds a certain amount
  • Inception date is on dec 2009.
  • Past 3 years return is 12.27% per annum.
  • 3Y and 5Y returns are higher than the benchmark, however 1Y are lesser than the benchmark.
  • The top portfolio holdings of the fund include HDFC Bank Ltd, Kotak Mahindra Bank Ltd., Maruti Suzuki India Ltd., Pidilite Industries Ltd.etc.
  • The holdings are balanced across various sectors with maximum weightage given to financial sector (36.85%).

If you are already invested in this scheme, you may consider switching to a better performing scheme. Some examples of popular ELSS for 2017:

Reliance Tax Saver (ELSS) Fund 

IDFC Tax Advantage (ELSS) Fund 

Aditya Birla Sun Life Tax Relief 96

Happy Investing!


aniket

Axis Long Term Equity Fund is a scheme which is focused on saving tax. It claims to save tax up to Rs. 46,350 per year by investing up to Rs.1.5 lakhs per year according to section 80C of the Income Tax Act, 1961. It is an Equity Linked Saving Scheme (ELSS) with a 3-year lock-in period. The money is invested in equity markets.

This scheme is focused on long term opportunities rather than short term gains. This provides more stability and chances of greater returns vis-a-vis the other schemes. This fund is targeting companies with sustainable growth objectives and firms wanting to create wealth in 3-4 years. The lock-in period facilitates that. It helps to avoid short run volatility. Also, the fund manager is working on a bottom-up basis. He is judging all the stocks individually, only on their prospects, and not trying to worry about the overall market direction or what the market benchmarks are doing. This has enabled the fund to create enormous value for investors.

This fund offers the lowest lock-in period among other tax saving instruments available in the market. It is suitable for people wanting to invest for at least 3 to 5 years. If you are seeking capital appreciation over long term, this is the fund for you. Also, if you are interested in a diversified portfolio mainly consisting of equity instruments, this is a good option.

The fund manager, Mr. Jinesh Gopani, has been managing this fund since April 2011 and it has performed well continuously. Thus, it seems that your money is in safe hands.

Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.
Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, investment goal, time frame, risk and reward balance and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs.
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