ELSS equity MFs offer dual benefits of tax saving & wealth building. Here's how
ELSS mutual funds offer exemption on investments up to Rs 150,000 under Section 80C of the Income Tax Act.
Investing in ELSS MF schemes over a long term is more remunerative in comparison to various options available under section 80C, Deepak Gagrani, Founder of Madhuban Finvest said as he picks this instrument as one of his top choices for both tax savings and long-term wealth creation.
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Indian equity benchmark delivered an impressive 23% return in 2023, outperforming all other asset classes. In the calendar year, markets produced 240 multibaggers largely driven by the rally in midcap and smallcap stocks. These stocks have market capitalisation of Rs 1,000 crore or more. However, markets have displayed volatility over the first one and a half months in 2024.
Investors looking for twin engines of quality and growth.
Success in ELSS investment is primarily a function of time rather than timing, Gagrani said, advising investors to opt for a systematic investment plan (SIPs) in ELSS to mitigate the impact of market timing on long-term returns.
Echoing similar views and pitching for ELSS, Mukesh Kochar, National Head of Wealth at AUM Capital said that timing the market is very difficult and a recipe for disaster as short-term returns may not reflect the true potential of the scheme if markets are volatile. One needs to start SIP/STP and do it every year for a longer period apart from initiating a lump sum
