15 ELSS Mutual Funds That Enhanced Wealth of Investors Over 1.25 Times in Three Years
In the last three years, 15 Equity-Linked Savings Schemes (ELSS) have grown investors’ wealth manifold, growing it over 1.25 times. Out of the 36 ELSS funds that have made it to three years in the market, a few have provided decent returns to investors with systematic investment plans (SIP).
Best-Performing ELSS Mutual Funds
The SBI Long Term Equity Fund, which is one of the oldest ELSS funds, grew investors’ wealth 1.40 times in the past three years. A Rs. 10,000 monthly SIP in this scheme would have become Rs. 5.04 lakh, with an investment of Rs. 3.60 lakh. The scheme gave an Extended Internal Rate of Return (XIRR) of 23.49% over this period.
The Motilal Oswal ELSS Tax Saver Fund converted the same SIP investment into Rs. 4.91 lakh, multiplying wealth by 1.37 times, with an XIRR of 21.54%. This was followed by the HDFC ELSS Tax Saver Fund, which increased wealth by 1.36 times, growing the investment to Rs. 4.88 lakh with an XIRR of 21.07%.
The Parag Parikh ELSS Tax Saver Fund and HSBC ELSS Tax Saver Fund doubled investments by 1.30 times both. A monthly SIP of Rs. 10,000 in Parag Parikh ELSS Tax Saver Fund would have turned out to be Rs. 4.68 lakh, whereas the same sum in HSBC ELSS Tax Saver Fund would have been Rs. 4.66 lakh.
The Franklin India ELSS Tax Saver Fund returned 1.29 times SIP investment over the previous three years. The JM ELSS Tax Saver Fund and Quantum ELSS Tax Saver Fund, on the other hand, had investments of 1.28 times.
Four other schemes—HSBC Tax Saver Equity Fund, ITI ELSS Tax Saver Fund, Taurus ELSS Tax Saver Fund, and Baroda BNP Paribas ELSS Tax Saver Fund—have increased SIP investments by 1.27 times each one of them, returning XIRRs between 16.26% and 16.42% during the period.
The LIC MF ELSS Tax Saver Fund and Nippon India ELSS Tax Saver Fund increased investments by 1.26 times and 1.25 times, respectively.
Performance of Other ELSS Funds
Apart from these 15 funds, the rest of the 21 ELSS schemes in the category returned between 1.11 times and 1.24 times the invested sum over the past three years. The Mirae Asset ELSS Tax Saver Fund augmented SIP investment by 1.22 times, taking a Rs. 10,000 SIP every month to Rs. 4.40 lakh with an XIRR of 13.73%.
The Axis ELSS Tax Saver Fund, the biggest ELSS fund in the market, witnessed investments increase by 1.21 times, with a Rs. 10,000 monthly SIP crossing Rs. 4.35 lakh and an XIRR of 12.83%.
Other ELSS funds, including the Quant ELSS Tax Saver Fund, Sundaram Diversified Equity Fund, and Groww ELSS Tax Saver Fund, increased investors’ wealth by 1.17 times each. Meanwhile, the Shriram ELSS Tax Saver Fund provided a return of 1.11 times, translating a monthly SIP investment into Rs. 3.99 lakh with an XIRR of 6.90%.
Methodology and Disclaimer
The analysis has taken into account all the ELSS schemes on offer in the market for the last three years. The assessment was made on regular and growth offerings, while the SIP performance was calculated for the period.
But this evaluation is not an investment suggestion. Investment or redemption choices should not be made by investors based on this information alone. Choosing an ELSS scheme must be in accordance with personal risk tolerance, investment horizon, and personal financial planning techniques.
Understanding ELSS Mutual Funds
Equity-linked savings schemes (ELSS) are tax-saving investment schemes under Section 80C of the Income Tax Act. Investors can invest a maximum of Rs.1.5 lakh in a year and get tax deductions on their investments. These funds are mainly invested in equities; hence, they are high-risk products. ELSS funds also have a lock-in period of three years, which helps investors witness the nature of equity market fluctuations over a period of time.
For those who want to save taxes while enjoying the possibility of long-term growth in equity, ELSS funds are still a good choice. But market risks and investment horizons must be carefully considered before making any investment.
