Best ELSS(Tax saving mutual funds)
- Thread starter nilesh78
- Start date
Re: Need suggestions in choosing Tax Saving MF
well if there are so many funds in a portfolio, there is a problem of over diversification.... meaning your entire portfolio would start resembling the broader index (portfolio starts acting like one big index fund). So it is very important to chose good funds that have performed well in bull & bear markets and place bets on them.
If you are investing in other funds apart from ELSS then one ELSS fund should be more than enough.
However if you are investing ONLY in ELSS then the choice should be
1.one large cap ELSS - choices:- Fildelity tax advantage,Sunlife tax relief 96
2. one multicap/midcap/small cap fund - Birla Equity Plan, Magnum Taxgain, Principal Tax saver and HDFC Taxsaver. Also please check out the size of the fnd while investing in midcaps. Smaller the size, more aggressive position can be taken by fund manger on select stocks.
Two funds can do the trick.
Cheers!
well if there are so many funds in a portfolio, there is a problem of over diversification.... meaning your entire portfolio would start resembling the broader index (portfolio starts acting like one big index fund). So it is very important to chose good funds that have performed well in bull & bear markets and place bets on them.
If you are investing in other funds apart from ELSS then one ELSS fund should be more than enough.
However if you are investing ONLY in ELSS then the choice should be
1.one large cap ELSS - choices:- Fildelity tax advantage,Sunlife tax relief 96
2. one multicap/midcap/small cap fund - Birla Equity Plan, Magnum Taxgain, Principal Tax saver and HDFC Taxsaver. Also please check out the size of the fnd while investing in midcaps. Smaller the size, more aggressive position can be taken by fund manger on select stocks.
Two funds can do the trick.
Cheers!
Last edited:
Re: Need suggestions in choosing Tax Saving MF
please correct me if I am wrong Magnum Taxgain (bench mark bse-100) does not seems to be a mid-cap ELSS. So are Birla Equity Plan and Principal Tax saver.
They have substantial investment in large caps as well. The closest an ELSS comes to be called as Mid-cap fund is Ing Tax savings. (benchmark cnx midcap 100).
I'm planning to invest in that. I like the ZIP pack in ING (as opposed to SIP, ZIP invests daily and that is most advantageous in cost price avergaing..)
please correct me if I am wrong Magnum Taxgain (bench mark bse-100) does not seems to be a mid-cap ELSS. So are Birla Equity Plan and Principal Tax saver.
They have substantial investment in large caps as well. The closest an ELSS comes to be called as Mid-cap fund is Ing Tax savings. (benchmark cnx midcap 100).
I'm planning to invest in that. I like the ZIP pack in ING (as opposed to SIP, ZIP invests daily and that is most advantageous in cost price avergaing..)
Re: tax saving
fortunately for people like you and me, there are some work around to invest lumpsum.
you need to invest in a liquid fund, then systematically transfer money from that to a equity oriented fund. (so you already earn a small 4-5% per annum in liquid fund.)
ING vysya offers a ZIP pack that makes this investment in just one Application. This systematically transfers money on a daily basis. You cannot ask for more. Invest in this fund, then transfer daily for next 100 business days (roughly 5 month period.)
fortunately for people like you and me, there are some work around to invest lumpsum.
you need to invest in a liquid fund, then systematically transfer money from that to a equity oriented fund. (so you already earn a small 4-5% per annum in liquid fund.)
ING vysya offers a ZIP pack that makes this investment in just one Application. This systematically transfers money on a daily basis. You cannot ask for more. Invest in this fund, then transfer daily for next 100 business days (roughly 5 month period.)
Re: Need suggestions in choosing Tax Saving MF
Hi Vicky,
Thanks for your suggestion. I din't have much idea about the technical analysis. I agree that two funds should do instead of 4 or 5.
As a part of taxs-savings investments, I am already investing in HDFC Long Term Advantage Growth and Franklin Tax Shield more regularly.
Please advice me whether I can continue with those two, or should I replace them with any of the MF you have mentioned like Fidelity TaxAdvantage.
Thanks again.
Hi Vicky,
Thanks for your suggestion. I din't have much idea about the technical analysis. I agree that two funds should do instead of 4 or 5.
As a part of taxs-savings investments, I am already investing in HDFC Long Term Advantage Growth and Franklin Tax Shield more regularly.
Please advice me whether I can continue with those two, or should I replace them with any of the MF you have mentioned like Fidelity TaxAdvantage.
Thanks again.
well if there are so many funds in a portfolio, there is a problem of over diversification.... meaning your entire portfolio would start resembling the broader index (portfolio starts acting like one big index fund). So it is very important to chose good funds that have performed well in bull & bear markets and place bets on them.
If you are investing in other funds apart from ELSS then one ELSS fund should be more than enough.
However if you are investing ONLY in ELSS then the choice should be
1.one large cap ELSS - choices:- Franklin India Taxshield, Fildelity tax advantage,Sunlife tax relief 96
2. one midcap/small cap fund - Birla Equity Plan, Magnum Taxgain, Principal Tax saver and HDFC Taxsaver. Also please check out the size of the fnd while investing in midcaps. Smaller the size, more aggressive position can be taken by fund manger on select stocks.
Two funds can do the trick.
Cheers!
If you are investing in other funds apart from ELSS then one ELSS fund should be more than enough.
However if you are investing ONLY in ELSS then the choice should be
1.one large cap ELSS - choices:- Franklin India Taxshield, Fildelity tax advantage,Sunlife tax relief 96
2. one midcap/small cap fund - Birla Equity Plan, Magnum Taxgain, Principal Tax saver and HDFC Taxsaver. Also please check out the size of the fnd while investing in midcaps. Smaller the size, more aggressive position can be taken by fund manger on select stocks.
Two funds can do the trick.
Cheers!
Re: Need suggestions in choosing Tax Saving MF
Both these funds are very good funds and they have a 4 star rating in value research. Franklin Taxshield has a large cap bias and HDFC LT Advantage has a midcap bias (~60%).You could consider Principal Tax Saving Fund for midcaps. Your choice
http://www.valueresearchonline.com/funds/newsnapshot.asp?schemecode=89
Hi Vicky,
Thanks for your suggestion. I din't have much idea about the technical analysis. I agree that two funds should do instead of 4 or 5.
As a part of taxs-savings investments, I am already investing in HDFC Long Term Advantage Growth and Franklin Tax Shield more regularly.
Please advice me whether I can continue with those two, or should I replace them with any of the MF you have mentioned like Fidelity TaxAdvantage.
Thanks again.
Thanks for your suggestion. I din't have much idea about the technical analysis. I agree that two funds should do instead of 4 or 5.
As a part of taxs-savings investments, I am already investing in HDFC Long Term Advantage Growth and Franklin Tax Shield more regularly.
Please advice me whether I can continue with those two, or should I replace them with any of the MF you have mentioned like Fidelity TaxAdvantage.
Thanks again.
http://www.valueresearchonline.com/funds/newsnapshot.asp?schemecode=89
Re: Need suggestions in choosing Tax Saving MF
I could have wrongly worded, but I consider any portfolio >50% midcap/small cap exposure as a midcap fund or midcap biased fund. I got this data from valueresearchonline.com
Magnum taxgain now has 55% in large caps... but that value has been occillating for sometime it was around 45% about 2 months back.
Principal Tax Savings ~61% midcap/smallcap/tiny cap
http://www.valueresearchonline.com/funds/portfoliovr.asp?schemecode=89
Birla Equity Plan ~58% midcap/smallcap/tiny cap
http://www.valueresearchonline.com/funds/portfoliovr.asp?schemecode=590
please correct me if I am wrong Magnum Taxgain (bench mark bse-100) does not seems to be a mid-cap ELSS. So are Birla Equity Plan and Principal Tax saver.
They have substantial investment in large caps as well. The closest an ELSS comes to be called as Mid-cap fund is Ing Tax savings. (benchmark cnx midcap 100).
I'm planning to invest in that. I like the ZIP pack in ING (as opposed to SIP, ZIP invests daily and that is most advantageous in cost price avergaing..)
They have substantial investment in large caps as well. The closest an ELSS comes to be called as Mid-cap fund is Ing Tax savings. (benchmark cnx midcap 100).
I'm planning to invest in that. I like the ZIP pack in ING (as opposed to SIP, ZIP invests daily and that is most advantageous in cost price avergaing..)
Magnum taxgain now has 55% in large caps... but that value has been occillating for sometime it was around 45% about 2 months back.
Principal Tax Savings ~61% midcap/smallcap/tiny cap
http://www.valueresearchonline.com/funds/portfoliovr.asp?schemecode=89
Birla Equity Plan ~58% midcap/smallcap/tiny cap
http://www.valueresearchonline.com/funds/portfoliovr.asp?schemecode=590
Re: Need suggestions in choosing Tax Saving MF
Yes, they are heavily with mid-caps or below. But I have problems with the variety of ELSS funds on offer.
There is no single ELSS that is an index fund. If there is, we will pay less yearly fees and wont rely on fund managers performance, but of the market performance. Also there iis no pure mid cap funds from Big AMC's.
Having searched for Mid cap funds with my criteria being "Not any stock that I hold in large cap" (I mostly hold stocks in nifty-50 only for liqudity & better stock margin while pledging for F&O), I know that many funds failed my criteria except ING.
I use money control's portfolio and check out atleast top 20 stock investments of funds to see whether it overlaps my stock portfolio greatly.
ING's ZIP pack is very interesting and I decided put some in it. All top 20 investments of ING was not in my portfolio. I thought, ok this is the fund where I am comfortable paying a fund manager a 2% annual fee because some of the stocks were quite new to me. It may/may not out-perform, but it helps me to diversify portfolio.
It is good that some of us have consciousness of how we want to diversify. Most fund advisor's I met are horrible. They think investing in "Top 3 funds" is the best diversification.
Yes, they are heavily with mid-caps or below. But I have problems with the variety of ELSS funds on offer.
There is no single ELSS that is an index fund. If there is, we will pay less yearly fees and wont rely on fund managers performance, but of the market performance. Also there iis no pure mid cap funds from Big AMC's.
Having searched for Mid cap funds with my criteria being "Not any stock that I hold in large cap" (I mostly hold stocks in nifty-50 only for liqudity & better stock margin while pledging for F&O), I know that many funds failed my criteria except ING.
I use money control's portfolio and check out atleast top 20 stock investments of funds to see whether it overlaps my stock portfolio greatly.
ING's ZIP pack is very interesting and I decided put some in it. All top 20 investments of ING was not in my portfolio. I thought, ok this is the fund where I am comfortable paying a fund manager a 2% annual fee because some of the stocks were quite new to me. It may/may not out-perform, but it helps me to diversify portfolio.
It is good that some of us have consciousness of how we want to diversify. Most fund advisor's I met are horrible. They think investing in "Top 3 funds" is the best diversification.
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