Srikanth Matrubai is known as the WEALTH ARCHITECT. He is practitioner of Wealthy Habits and author of Amazon Best Selling Book DON'T RETIRE RICH.
We strongly urge to follow your Advisor. This blog is purely for information.
However, we strongly suggest you to consult a Financial adviser.
This blog is purely for information purposes only and we do not take any responsibility whatsoever as the blog content may be changed from time to time and is generic in nature.
Tuesday, January 24, 2012
RELIGARE TAX PLAN - RETURN KICKER
The Tax Saving Action is in Full Force.
Choose your investments wisely. And move away from "Tax Saving" mindset to the more efficient "Tax Planning"!!!!
While the options for you are plenty...PPF, Insurance, NPS, etc. it is undoubtedly the Equity Linked Saving Schemes that win hands down.
Avoid Insurance, expect Term Insurance.....but do consider PPF as they will take care of your Debt exposure.
NPS has a cap of 50% for equity exposure and hence is not recommended by me.
Yes, ELSS continues to the BEST option for your Tax Saving under Section 80C.
Before reading further I strongly recommend you to read....
Among the Equity Linked Savings Schemes, I have been a favourite of Religare Tax Plan since its inception in December 2006. Not without reason too as the Fund has truly been impressive both in bull and bear phases.
Religare Tax Plan is among the more 'aggressive' of the ELSS umbrella. However this mid cap exposure has not done any harm to the Fund's performance even in Bear Markets, which is truly remarkable.
The Fund tends to stay fully invested and avoid Cash calls....the 3 year mandatory lock-in period obviously helps.
The stock selection is very active and the top ten holdings have seen regular changes.
But the churning has not affected the Funds performance. The Focus on Bottom up stock picking and the avoidance of Cyclical plays have been the reason for its consistency.
Fund Manager Vetri Subramaniam and Vinay Paharia have largely restricted exposure to Large Cap ...in fact at one point of time, the Large Cap exposure of Religare Tax Plan was below 25%...
The Fund has reasonable diversification and does not shy away from booking profits.
The fund has also given 4 Dividends in the last 4 years.
The Fund has consistently beaten its Benchmark throughout its tenure and by a fair margin.
The Fund corpus is 109 crores which is a cause of concern but the consistently strong performance has managed to soothe the concerns.
Once the Direct Tax Code kicks in, the ELSS may become defunct as an investment alternative...make the maximum use of it till then.
If you are aggressive investor and would not mind volatility then Religare Tax Plan is the one for you.
You can also have a look at Taurus Tax Shield, though the Asset Size of only 65 crores is a cause of concern.
Other investors should seriously look at Canara Robecco Equity Tax Saver, HDFC Tax Saver, Kotak Tax Saver, Fidelity Tax Advantage among others.