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Financial Services
amity university
Tax Saving Mutual Fund Schemes
Financial Services
[ The following report gives us the description of three tax saving mutual funds schemes]
Introduction
There are many schemes which give tax advantage on investments .e.g.:1. Insurance2. NSC/KVP
3. Bank fixed deposits of 5 years & above
4. RBI deposit schemes
5. PPF
6. Tax saving schemes of mutual funds
Most of the above schemes give an average return of 7-9 % over long time periods. Lock-in time also varies from 3-7 years. As per historic data the best returns were given by tax saving schemes of mutual funds with a lock-in of only 3 years which is the minimum for a tax saving scheme. Therefore it is suggested that tax saving money should be invested in Tax saving mutual funds for best returns along with tax benefit on investment amount as well as on the return on investments i.e. dividends which is completely tax free. Following tax saving schemes are doing very good performance:
1. HDFC tax saver2. Prudential ICICI tax saver
3. Franklin India tax shield
4. Birla Equity fund
5. Tata tax saving fund
6. Reliance tax saver (ELSS) fund
7. SBI tax saving fund
A return of 15-20% p.a. should be achieved comfortably in a tax saving scheme of mutual fund as the funds are invested for a min. period of 3 years i.e. the lock in period.ELSS, popularly known as Tax Saving Mutual Fund, is a category ofMutual Fundwhere a major portion is invested in Equity & Equity related instruments. An investment up to 1 lakh is exempted from income under section 80C, but there is a lock in of 3 years before you can withdraw. However, there is no upper limit on investments and long term capital appreciations are tax free. Dividends received are also tax free in the hands of the investor.
Types of ELSS
1.Growth:Investor does not get any income during the tenure of the investment. He will get a lump sum amount at the time of redemption or on maturity.
2. Dividend: Investor gets a dividend from the fund house. He has two options:
He can cash on the dividends.
He can opt for dividend re-investment option.
In most funds you have Growth as well as Dividend options which you can choose depending upon your priorities.
The following report gives us the description of three tax saving mutual funds schemes1. ICICI Pru Tax Plan (G)Latest NAV
127.98 (30/08/11)
52-Week High
155.09 (10/11/10)
52-Week Low
122.45 (26/08/11)
Fund Category
Equity: Tax Planning
Type
Open End
Launch Date
August 1999
Risk Grade
Average
Return Grade
Above Average
Net Assets (Cr)
1,323.19 (30/06/11)
Benchmark
S&P CNX 500
Annual Returns
20102009200820072006
Fund Return
24.11
112.00
-56.03
40.95
26.15
Rank In Category
9/37
1/32
16/29
22/26
17/23
Category Average
18.78
81.79
-55.56
59.25
30.18
Sensex
17.43
81.03
-52.45
47.15
46.70
S&P CNX Nifty
17.95
75.76
-51.79
54.77
39.83
Quarterly Returns
Q1Q2Q3Q4
2011
-6.69
0.56
--
--
2010
4.64
3.77
12.29
1.79
2009
-0.91
51.11
25.62
12.71
2008
-28.95
-9.83
-7.51
-25.78
2007
-10.92
13.19
7.89
29.56
2006
18.23
-15.75
23.35
2.68
2005
8.92
13.24
28.84
6.22
2004
-18.36
-3.23
32.76
30.09
2003
-10.13
43.79
40.24
38.14
2002
15.86
1.69
-13.24
10.99
2001
-13.41
0.68
-13.46
24.67
2000
6.97
-34.73
-7.42
-8.09
1999
--
--
--
55.78
Fund Details
VR Category
Equity: Tax Planning
Type
Open End
Load
Entry Load
Nil
Exit Load
Nil
Basics
Min Investment (Rs)
500
Subsequent Investment (Rs)
500
Min Withdrawal (Rs)
500
Min Balance
--
Pricing Method
Forward
Purchase Cut-off Time (hrs)
15
Redemption Cut-off Time (hrs)
15
Redemption Time (days)
3
Lock-in
1095 days
Cheque Writing
--
Systematic Investment Plan
SIP
Yes
Initial Investment (Rs)
500
Additional Investment (Rs)
500
No of Cheques
5
Note
The scheme also offers a quarterly SIP with minimum investment of Rs 5000 and 4 post-dated cheques of Rs 5000 each.
Tax Section Applicable
Section 88 (2) (XIII B)Section 54EASection 54EBSection 54ECSection 54EDSection 10(33)Section 112(1)Section 94(7)Trailing Returns
As of 30Aug2011Fund ReturnCategory ReturnSensexS&P CNX Nifty
Year-to-Date
-15.26
-15.59
-19.96
-19.80
1-Week
0.83
0.57
-0.50
-0.59
1-Month
-9.27
-7.72
-9.79
-10.26
3-Month
-7.84
-6.25
-9.96
-10.11
1-Year
-6.41
-9.51
-8.96
-9.16
2-Year
12.55
6.38
1.54
1.96
3-Year
12.60
7.14
4.07
4.11
5-Year
8.21
8.38
6.96
7.48
Return less than 1-year are absolute and over 1 year are annualised
NAV Chart
2) UTI Equity Tax Savings Plan-G
Current Stats & Profile
Latest NAV
36.76 (30/08/11)
52-Week High
45.22 (09/11/10)
52-Week Low
35.44 (26/08/11)
Fund Category
Equity: Tax Planning
Type
Open End
Launch Date
December 1999
Risk Grade
Average
Return Grade
Below Average
Net Assets (Cr)
496.47 (30/06/11)
Benchmark
BSE 100
Relative Performance (Fund Vs Category Average
Trailing Returns
As of 30Aug2011Fund ReturnCategory ReturnSensexS&P CNX Nifty
Year-to-Date-14.85-15.59-19.96-19.80
1-Week0.460.57-0.50-0.59
1-Month-6.63-7.72-9.79-10.26
3-Month-4.62-6.25-9.96-10.11
1-Year-6.80-9.51-8.96-9.16
2-Year6.166.381.541.96
3-Year5.657.144.074.11
5-Year6.338.386.967.48
Return less than 1-year are absolute and over 1 year are annualised
Annual Returns
20102009200820072006
Fund Return17.5772.88-54.6750.9218.56
Rank In Category21/3724/3213/2919/2622/23
Category Average18.7881.79-55.5659.2530.18
Sensex17.4381.03-52.4547.1546.70
S&P CNX Nifty17.9575.76-51.7954.7739.83
Quarterly Returns
Q1Q2Q3Q4
2011-6.86-1.42----
20102.101.1513.610.21
20090.5238.5018.404.88
2008-26.89-12.84-7.74-22.90
2007-9.0514.1617.7123.48
200614.13-16.3313.199.68
20050.568.7522.039.95
20041.13-8.2714.3022.12
2003-4.5614.6328.3931.78
200213.72-1.48-4.4210.61
2001-11.28-2.19-19.9124.16
2000---4.90-7.562.88
Fund Details
VR Category
Equity: Tax Planning
Type
Open End
Load
Entry Load
Nil
Exit Load
Nil
Basics
Min Investment (Rs)
500
Subsequent Investment (Rs)
500
Min Withdrawal (Rs)
--
Min Balance (Rs)
500
Pricing Method
Forward
Purchase Cut-off Time (hrs)
15
Redemption Cut-off Time (hrs)
15
Redemption Time (days)
10
Lock-in
1095 days
Cheque Writing
--
NAV Chart
3) LIC Nomura MF Tax Plan-G
Current Stats & Profile
Latest NAV
26.0668 (30/08/11)
52-Week High
33.0172 (09/11/10)
52-Week Low
24.8573 (26/08/11)
Fund Category
Equity: Tax Planning
Type
Open End
Launch Date
March 1997
Risk Grade
Above Average
Return Grade
Low
Net Assets (Cr)
38.68 (30/06/11)
Benchmark
Sensex
Trailing Returns
As of 30Aug2011Fund ReturnCategory ReturnSensexS&P CNX Nifty
Year-to-Date-18.35-15.59-19.96-19.80
1-Week0.820.57-0.50-0.59
1-Month-8.78-7.72-9.79-10.26
3-Month-8.26-6.25-9.96-10.11
1-Year-9.91-9.51-8.96-9.16
2-Year0.306.381.541.96
3-Year2.657.144.074.11
5-Year2.618.386.967.48
Return less than 1-year are absolute and over 1 year are annualised
Annual Returns
20102009200820072006
Fund Return15.7362.17-56.8748.7628.25
Rank In Category25/3731/3218/2920/2615/23
Category Average18.7881.79-55.5659.2530.18
Sensex17.4381.03-52.4547.1546.70
S&P CNX Nifty17.9575.76-51.7954.7739.83
Quarterly Returns
Q1Q2Q3Q4
2011-5.54-2.96----
2010-0.772.5312.810.83
2009-1.9144.4915.35-0.80
2008-32.30-17.10-1.79-21.75
2007-8.4711.1312.4930.01
200621.48-14.0410.6311.02
2005-1.255.0617.331.74
20040.16-11.689.6814.63
2003-7.7922.8833.0229.50
20027.962.31-11.3715.69
2001-44.71-4.14-2.093.35
20001.40-20.23-7.152.59
199919.714.3232.899.02
19987.16-15.004.56-1.09
1997-----2.19-1.73
Fund Details
VR Category
Equity: Tax Planning
Type
Open End
Load
Entry Load
Nil
Exit Load
Nil
Basics
Min Investment (Rs)
500
Subsequent Investment (Rs)
100
Min Withdrawal (Rs)
--
Min Balance
--
Pricing Method
Forward
Purchase Cut-off Time (hrs)
15
Redemption Cut-off Time (hrs)
15
Redemption Time (days)
3
Lock-in
1095 days
Cheque Writing
--
Systematic Investment Plan
SIP
Yes
Initial Investment (Rs)
--
Additional Investment (Rs)
100
No of Cheques
6
Note
Exit load of 2.25% if units are redeemed before 1 year.
Tax Section Applicable
Section 88 (2) (XIII B)Section 54EASection 54EBSection 54ECSection 54EDSection 10(33)Section 112(1)Section 94(7)
NAV Chart
Submitted by:
Divya Vishwanadh (A-01)
Sumedha Gupta (A-02)
Shipra Singh (A-06)
Deepshikha Sahu (A-08)
Vijeta Jain (A-31)
BBA + MBA (Dual)
Submitted to: Geetika Chawla
Amity University