ELSS Funds

Best SIP Funds to Invest Online 

Returns: 13.62% (Last three years) 

Equities had a terrific 2017, and the rally has continued into the new year. The average ELSS fund rose 36% during 2017, and even the long-term performance is fairly decent. The category has given 18% compounded returns in the past five years. Investors have seen their wealth double in a little over four years. What's more, the returns are tax free because long-term capital gains from equity funds are exempt from tax. 

SIPs are when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich

While ELSS funds look attractive, the elephant in the room is the all-time high level of the market. The Nifty is trading at a PE of almost 27 and many analysts have advised investors to be cautious. Others say that expectations of returns from equities need to be toned down. Given the high levels of the markets right now, don't expect equity funds to repeat the performance of the past 1-2 years in 2018. 

Some investors have stopped their SIPs in ELSS funds because markets are high. I will restart SIPs when markets correct. We believe stopping SIPs for a few months will not make a significant difference to his overall returns.

 

An aggressive investor, he invests in ELSS funds to save tax. But he is also a careful investor and invests through SIPs of Rs 5,000 per month. 
Smart tip: Avoid investing large sums in ELSS at one go. Take the SIP route for best results. 

The Best ELSS Funds

Don't base your choice on a fund's short term performance. The stability of returns is more important than the quantum of gain. Look at the 3-year and 5-year performance of the scheme before you make a choice. Small investors often treat ELSS funds as short-term investments and exit after the three-year lock in period. Look at ELSS funds as regular equity funds that should be held for the long term. 

If you are investing for the long term, don't go for the dividend option. Dividends are just another way of booking profits because the amount received gets deducted from the NAV. The dividend reinvestment option is even worse. Every time the fund gives out a dividend and reinvests the money into your account, the three-year lock in period starts all over again. In effect, you are locked in for perpetuity. 

 

SIPs are when Stock Market is high volatile. Invest in Best Mutual Fund SIPs and get good returns over a period of time. Know Top SIP Funds to Invest Save Tax Get Rich

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