If you’re looking for the best ELSS funds to invest in 2024, then you’re at the right blog! We’ve compiled a list of ELSS funds that have stood out against their peers, generating decent returns while offering tax-saving benefits.
What are ELSS Funds?
An ELSS fund is a type of equity fund that invests in stocks but differs from other equity funds as it helps you save tax of up to ₹1.5 lakhs under Section 80C of the Income Tax Act.
While helping you save tax, ELSS funds also enable you to create long-term wealth through equity investing. At the same time, these funds carry a lock-in of 3 years which is mandatory.
Tax efficiency and returns aside, ELSS funds are run by professional fund managers who decide what to buy and sell. This benefit can be useful to you if you don’t have the time to make your own stock investing decisions.
Best ELSS Funds to Invest in 2023
If you are planning to invest in ELSS funds then here is a best ELSS mutual funds list for you.
1. Bandhan Tax Advantage ELSS Fund Direct-Growth
The scheme was started on 2nd Jan 2013. It is managed by Daylynn Pinto. The fund has a major investment in domestic equities which comprises more than 90% of the overall investments.
- Fund size: ₹5,976.05 Cr
- 3-year Return: 28.02%
- 5-year Return: 22.25%
- Expense Ratio: 0.59%
2. Parag Parikh Tax Saver Fund Direct-Growth
The scheme was started on 24th July 2019. It is managed by Rajeev Thakur, Raunak Onkar, Rukun Tarachandani and Raj Mehta. The fund has more than 80% of the investment in equities and the rest in debt.
- Fund size: ₹2,760.76 Cr
- 3-year return: 24.32%
- Expense Ratio: 0.73%
3. SBI Long-Term Equity Fund Direct Plan-Growth
The scheme was started on 2nd Jan 2013. It is managed by Dinesh Balachandran. The fund has more than 90% investment in equities and includes some of the biggest stocks in India.
- Fund size: ₹20,085.20 Cr
- Expense Ratio: 0.98%
- 3-year return: 27.30%
- 5-year Return: 22.90%
4. Kotak ELSS Tax Saver Fund Direct Plan-Growth
The scheme was started on 2nd Jan 2013. It is managed by Harsha Upadhyaya. The fund has more than 95% investment in equities, including many of the top 20 stocks in India.
- Fund size: ₹4,797.29 Cr
- Expense Ratio: 0.55%
- 3-year return: 21.26%
- 5-year Return: 21.07%
5. Quant Tax Plan Direct-Growth
The scheme was launched on 7th Jan 2013. It is managed by Ankit Pande and Vasav Sahgal. The fund has 95.27% investment in equities. Some of the top stocks in the portfolio are DLF, Adani Power, Ultratech Cement, Jio Financial Services, Sun Pharma etc.
- Fund size: ₹4,924.99 Cr
- Expense Ratio: 0.76%
- 1-year return: 11.78%
- 3-year Return: 35.55%
6. HDFC ELSS Tax Saver- Direct Plan-Growth
The scheme was launched on 1st Jan 2013. It is managed by Roshi Jain. The fund has 95.90% holdings in equities. The portfolio of the fund consists of stock of some leading companies like HCL Technologies, Infosys Ltd, Bharti Airtel, SBI, Cipla Ltd etc.
- Fund size: ₹11,501.97 Cr
- Expense Ratio: 1.14%
- 3-year return: 26.09%
- 5-year Return: 19.31%
7. Franklin India Taxshield Fund- Direct-Growth
The scheme was launched on 1st Jan 2013. The fund manager of the scheme is Anand Radhakrishnan and R. Janakiraman. The fund has more than 90% investment in equities.
- Fund size: ₹6,032.54 Cr
- Expense Ratio: 1.09%
- 3-year return: 24.00%
- 5-year Return: 18.00%
If you wish to invest in ELSS funds or different types of mutual funds, you can do so on our platform in a few simple and easy steps.
Why should you Invest in ELSS Funds?
Here are some of the main reasons for you to invest in ELSS funds: –
1. Tax Savings
One of the main reasons to invest in the best ELSS mutual funds is tax savings. The investment in ELSS funds is eligible for tax deduction under Section 80C. You can claim the deduction up to ₹1.50 lakhs.
2. High Returns
The majority of the investment of ELSS funds is in equity and equity-related instruments. As they are linked to markets, they have the potential to give higher returns in the long term.
3. Diversification
Diversification is another important reason for you to invest in ELSS funds. These funds are invested in a variety of stocks as per the market cap, sector, etc.
4. Shortest Lock-in period
Many tax savings products have a long lock-in period, i.e. Sovereign Gold Bonds (SGBs) have a lock-in of 5 years. However, ELSS funds have the shortest lock-in period of 3 years.
Conclusion
In this article, we have listed some of the best ELSS mutual funds for you, which we hope you found helpful. ELSS funds are typically used to save taxes and earn lucrative returns.
They also offer the benefit of diversification. Before investing, remember to conduct your research and ensure you consider your risk appetite and goals. By the way, you can invest in mutual funds on Dhan!
