Sir.
Not counting the Tax rebate on investment in ELSS, How does ELSS M F compare with non elss M F from same M F House , of similar portfolio. ? Does the 3 yr lock in period gives the fund manager better options / freedom, resulting in better returns ? If so, then would it be prudent to invest in an ELSS more than 1.5 L /?
Anand
2 Answers
Dear Anand,
- If you wish to save tax apart from getting good returns, invest in ELSS funds.
- ELSS Mutual funds tend to offer better returns than most of the equity funds. Therefore, even the investors who do not want to save tax can invest in ELSS Mutual Funds to create wealth over a long run.
- However, the investors who are not willing to lock their money can invest in general Flexi-cap/Diversified funds. Starting a SIP (Systematic Investment plan) in these funds might also offer good returns with the benefit of liquidity.
If we compare ELSS funds Vs large cap funds, ELSS funds generally outperform over different time-points.
Same is not the case with ELSS Vs Flexi-cap funds. For some time periods, flexi cap funds have outperformed the ELSS Funds.
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