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Best ELSS Tax Saving Mutual funds to invest in 2017 – Top Performing

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elss-funds

Equity Linked Savings Scheme (ELSS) Mutual Funds are one of the popular 80C tax saving options for savvy investors.

Quick Overview of ELSS Funds

  • ELSS is a diversified equity mutual fund which has a majority of the corpus invested in equities.
  • There is a lock in period of 3 years from the date of investment. You can remain invested even after 3 years and can withdraw anytime after that lockin.
  • Returns are based on returns from Equity Markets.  Returns from ELSS Schemes are tax free. Based on previous returns, some of the funds has grown 3 times in 5 years.
  • There is no limit of investment in ELSS Funds, but you can claim Tax deduction upto Rs 1.50 Lakh under Section 80C of Income Tax Act.

It is always better to invest

  • via SIP mode rather than lumpsum (for cost averaging)
  • in GROWTH Option  (for wealth accumulation)
  • in DIRECT Plan ( to save costs & higher returns)

Read – Other Tax Saving Options u/s 80C

 

Top performing ELSS Mutual Funds – which you can consider investing in 2017

    Annualised Return (in % annualised)
  AUM 1 Yr 2 Yr 3 Yr 5 Yr
ELSS (in crores)        
           
Reliance Tax Saver (ELSS) (G 8405 20.6 17.8 13.2 21.7
Axis Long Term Equity Fund (G) 13359 18.1 12.5 15 22.8
ABSL Tax Relief 96 (G 3501 21.1 17.2 18.9 21.9
DSP-BRTax Saver Fund (G 2808 17.1 19.1 17.1 21.1
IDFC Tax Advantage (ELSS)-RP (G) 623 26.5 18.9 18.2 21.1
L&T Tax Advantage (G) 2373 23.7 19 16.8 19
Tata India Tax Savings Fund – Direct (G) 398 22.1 19.6 20.7  
Wealth18.com  updated on 24 Oct 2017          

Please note that above returns are annualised returns / CAGR.  For clarification,

  • mutual fund investment will double in 5 years, if its CAGR return is 15%.
  • mutual fund investment will become 3 times in 5 years, if its CAGR return is 24.5%.

Also read – Best Equity Funds (Large, Midcap fund, Diversified) to invest in 2017

Read – From 1st Feb 2017, New Central KYC process must for new Mutual Fund Investors.

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If you have any queries related to ELSS Funds, or any other personal finance, feel free to use the comment box below.

If you have any queries related to this article or any other personal finance query ( Investment, Taxation etc), please comment below

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About wealth18

The author is a Chartered Accountant and loves to write about Personal Finance, Wealth Management, Taxation etc. Disclaimer - The articles on this website is for informational and knowledge purposes and should not be treated as financial advice, Please consult your financial advisor before taking any investment decision.

4 comments

  1. Dear Sir,

    In the present volatile market fluctuations, this years best performing fund may not be that much performing in the next fy. Hence, it is unpredictable to say about the present years annual yield is more, the same cant be continued for next 2 to 3 years in that particular ELSS scheme of any AMC. In this circumstances, how can we assess the guaranteed return at high value of a particular ELSS fund for the ensuing 3 years….

    Regards…

    KVRao
    Hyderabad.

    • Hi, There is no guaranteed returns in Equity funds. You are right that the funds may not give same returns year after year, but over long term the Equities funds have given good returns.

      In the short term, the returns may be volatile, but in the long term, it should be beneficial.

      Having said that there is no guarantee, and one has to take risk for the expected returns.

  2. I am 47 year old and want to invest in tax saving ELSS. Please advise me. My target is for 5years having good return @5K per month. Should I invest Rs.5000/- Pm in a single company or @1000/- PM in different 5 companies. Please also mention the name of the company.

    • Hi Mahendra,

      You can consider allocating the amount in 2-3 funds. Some of the best performing funds are mentioned in the post.

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