Tax Savior - Wealth Creator

 

While some people are comfortable handling their own investments, many are not. Indian investors are already struggling between the 8-10% interest rates from the bank which merely beats the inflation.  If the long term goals are taken into consideration, then the below mentioned ELSS fund can prove to be one of the best in the basket. It simply saves tax up to Rs.1,50,000 and also manages to outperform the benchmark returns.

Individual investors are facing many emotional and financial conflicts which if left unresolved could put their future at risk. When there is no time to monitor the investments and lack of expertise, under such circumstances mutual funds come into picture directly cutting the confusion. If goals are clear with unique objectives then it is our responsibility to help you make more assured decisions about your financial future.

Birla Sun Life Tax Relief 96 – Growth Weekly Chart

Birla Sun Life Tax Relief 96 is an open ended Equity Linked Saving Scheme (ELSS) with 98.61% exposure to equity.

Portfolio Analysis: The fund aims to generate returns by investing in complete equity with maximum exposure to Banking/Finance and Automotive sector.

Sector Allocation:

Sector         % Banking and Finance 19.90 Automotive 16.85 Pharmaceuticals 9.18 Miscellaneous 6.13 Chemicals 6.11 Returns as on 19th October 2016

Period Returns (%) 1 year 12.91 3 year 27.41 5 year 20.08

Top Stock Holdings

Company	PE	% Assets
Sundaram-Clayto	52.29	6.81
Bayer Crop Science	48.94	5.10
Honeywell Automation	57.81	4.81
Kotak Mahindra Bank	35.71	3.89
ZEE Entertainment	48.79	3.88

Risk Profile: This fund is considered as “High Risk Fund” due to complete exposure to equity instruments, therefore it’s suitable for investors who are looking for Tax benefits.

Taxation Perspective: Birla Sun Life Tax Relief 96 is ELSS fund is where investor is eligible for tax exemptions up to 150,000 INR under section (u/s) 80C of the Indian Income Tax Act, 1961 if they stay invested for three years or more. ELSS Funds are also eligible for Long Term Capital Gains which will be treated tax free as the holding will be more than one year. The Dividend earned from ELSS funds is also treated as tax free.

Investment Rationale: Birla Sun Life Tax Relief 96 fund has shown some outperformance despite of no clear trend in the Indian Equity Markets.  We can expect the same in this fund to continue for next few weeks and one leg is still pending on downside which should provide excellent buying opportunities for lump sum investors.

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Go Online rather than making a mess with Physical Documents for MF Investments

“Mutual fund investment is subjected to market risk, Please read all the scheme related documents carefully” - You must have heard or read this phase in every mutual fund advertisement whether the advertisement is giving in a newspaper or on television. But one should not ignore this phase of reading the offer document because the most important step while investing your money in a mutual fund scheme. The offer document not only provide you A-Z information about the scheme but will also help you to decide whether an individual should invest in a particular scheme or not. 

 

One must know that a mutual fund offer document is made up of number of document such as Scheme Information Document(SID), Statement of Additional Information(SAI), Key Information Memorandum(KIM). 

Here are some of the important aspects that an investor should go through while reading the offer document.

   1)  Past Performance: Going through the past performance of the scheme is one of the most important aspect while reading a offer document. It is necessary that one should not only see the past performance of the scheme but also compare it with similar funds in the market as well as against the industry benchmark. However one should not use the past performance of the fund to judge it future.

    2)  Risk factor: The offer document also specifies all the risk that the fund will be exposed to. It is necessary that the investor should understand the amount risk that they will be exposed to while they invest in the fund. The bearing capacity of each individual is different and it is advisable that an individual should invest in the scheme only if his feels that he/she would be able to face the risk.

   3) Investment objective: While going through the investment objective of the fund  investors can get a fair idea of the strategies that the fund manager will use to achieve the said objectives. Match these objectives with your own expectations about income or long-term capital appreciation as well as your risk appetite.

    4)   Fees, Loads and Taxes: Read the ODs to learn about the minimum investments, charges applicable and services available to you. Some of the common charges applicable are Entry and Exit Loads, Transaction Charges, Security Transaction Tax (STT), various charges for managing the fund - together called the Total Expense Ratio (TER). It is important to know that all mutual funds do not have the same type of charges and that all these  charges are regulated by the Securities and Exchange Board of India (SEBI).

     Instead of going into a mess with Physical Documents and facing issues like incorrect data or signature change, switch to Online Investments with us, directly clubbed with NSE to avoid physical mess and ensure safety and security of Documents uploaded directly. Also, get your own log in account with us to get FREE Reports and Monthly Account Statements for faster Portfolio access. 

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