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Which is the best tax savings ELSS fund for SIP?

I'm planning to invest through SIP in DSP BlackRock and Reliance taxsaver fund. Can anyone let me know if this is a good choice to start with ?

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3 Approved Answers

Arpit Chandak

Both Reliance Tax Saver Fund and DSP Black Rock Tax Saver Fund have performed well over the period of time. And yes, it is a good choice to invest in these funds through SIP.

 Reliance Tax Saver Fund

  • It has performed well over the recent years. The fund was launched in the year 2005. It has completed more than a decade and has an astounding rate of 16.42% return over this period.
  • In the beginning, this fund focused primarily on mid-cap funds but over the time it has changed its major composition towards large cap funds.
  • The fund currently invests 59.8% of its capital in large-cap funds and 29.5% in mid-cap funds. However, the fund claims to maintain the balance between large-cap and mid-cap funds.
  • The success of this fund is many a time attributed to its fund manager, Ashwani Kumar. He has been managing the fund since its inception.
  • The majority of the assets of this fund are invested in financial services (22.1%) and industrial manufacturing sector (22.2%).

DSP Black Rock Tax Saver Fund

  • It has also given considerable higher returns to investors since inception. The fund was started in the year 2007 and has provided approximately 15.32% returns over the period.
  • However the fund saw the downward trend in the year 2007 and 2011, but in the bull market years, the returns counter the effects from the bear period.
  • The growth of this fund is attributed to the investment in fundamentally strong companies. The fund is managed by Rohit Singhania.
  • The fund holds large allocation (71.5%) in the large-cap companies. These companies are already proven in the market and have displayed an excellent performance record.
  • The balance is invested in the mid sized companies (27.8%).
  • Financial service sector holds the largest allocation (36.9%) in the fund. The other sectors in which this fund is invested in higher proportion in order are energy (12.7%), automobile sector (9.9%) and consumer goods (7.2%)

Pijush Kanti Biswas

ELSS is a dedicated mutual fund scheme that allows investors to save tax and also provides an opportunity for long term capital appreciation.

These are the best performer ELSS in last one year:

These all ELSS are available through SIP also.

If you are planning to invest through SIP among DSP Black Rock and Reliance tax saver fund, go with later one which is doing great as compared to former.

Detail analysis of these ELSS funds are show in this video:


Happy Investing!


Ankit

Equity linked Savings Scheme is preferred by investors these days because of the tax benefits that an investor gets. An investor will get a tax benefit of upto Rs 150000 under section 80C.

Mutual Fund

Reliance Taxsaver Fund

3 year return(%) - 14.33

5 year return(%) - 23.21

Mirae Asset Tax saver  Fund - -

Axis long term Equity Fund

3 year return(%) - 13.87

5 year return(%) - 22.97

Motilal Oswal MOSt Focussed Longterm Fund


Above mentioned are the returns for few of the top Equity linked Savings Scheme(ELSS). Investment can be done through SIP in any one of the funds or can be divided into 2 to 3 funds as per the choice of the investor. No tax will be charged if the investment is made for 3 years, but it is suggested by the industry experts to keep the amount invested in the fund for 5 to 10 years in order to get a good and healthy return. So it is suggested to investors that reviewing of the returns that an investor is getting should be done and then decision of continuing further with the investment or redeeming it should be taken. The above mentioned funds have been selected because of their consistency in giving returns and their downside risk is very less.

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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