Skip to main content

Franklin India Taxshield Fund

Invest In Tax Saving Mutual Funds Online

Call 0 94 8300 8300 (India)

 

Franklin Taxshield

A tax plan for the cautious investor

If you have limited risk appetite and are looking for tax-saving equity options, then Franklin India Taxshield is a good scheme to invest in the ELSS universe. With a return of 25.4 per cent compounded annually in the last 10 years, the fund convincingly beat its benchmark S&P CNX 500's return of 19.8 per cent over the same period.


This record is impressive considering that the benchmark index is a more diversified basket of stocks accounting for over 90 per cent of the total market cap, and is considered a tough benchmark to beat in the long term. The index has a good proportion of mid-cap stocks as well. Franklin Taxshield, on the other hand, managed this returns by predominantly investing in large-cap stocks

Suitability

Franklin Taxshield is suitable only for investors who cannot stomach too much risk and are content with reasonable returns that compensate the limited risk assumed. The fund fits such investors for the following reasons: one, it predominantly invests in large-cap blue chip stocks that are relatively less volatile in terms of earnings performance. Two, such exposure also contains downside risk during steep market falls, when mid-cap stocks typically bear the brunt of the market rout.

Three, except in 2009 when the fund preferred to participate in the market rally that just began, it has since 2004, been a regular dividend distributor for those who opted for a payout. As is the case with many funds from the Franklin house, the fund often pays dividends when it anticipates markets to peak.For instance, it paid hefty dividends twice in 2007, once at the beginning and once closer to the end of that year when markets rallied. To this extent, it is suitable for investors who wish to take some money off the table, given that their investment is otherwise subject to a three-year lock-in.

 

Performance

Franklin India Taxshield has a good record in the diversified fund universe, making it to the top quartile of performance chart over 3, 5, 7 and 10 year time frames. Unless you need the money after the three-year lock-in, you can consider holding this fund for longer time frames as well.

 

The fund performs particularly well in volatile markets as demonstrated in the last three years. Its compounded annual return over this period, at 10.6 per cent, is higher than top peers such as ICICI Pru Tax Plan. On a risk-adjusted basis (measured by Sharpe Ratio), the fund stands out as the top player in the ELSS universe over the last three years, suggesting that it delivers adequately for the measured risk it undertakes.

 

Over the same period, the fund beat its benchmark close to 90 per cent of the times on a rolling return basis. Over the last one year though, the fund lagged its benchmark by a percentage point. It also lagged quite a few peers. This could be primarily attributed to the rally in midcaps. The fund's benchmark has a good proportion in mid-cap stocks. Top peers in the last one year, such as Reliance Tax Saver also held as much as two-thirds of their holding in mid-cap stocks to ride the rally. Franklin Tax Shield, though, held about a fourth in midcaps.

 

Portfolio

Besides lower exposure to mid-caps, Franklin India Taxshield's exposure to certain sectors until the beginning of 2012 did not help either. Higher exposure to sectors such as software, which underperformed, and lower exposure to the robust pharma sector a year ago, may also have resulted in marginal underperformance. But the fund had by mid 2012 pruned exposure to software by reducing stakes in stocks such as Infosys and by also upping its holding in the pharma space. Holding in the telecom stock Bharti Airtel was also reduced. Gateway Distriparks, Gujarat Pipavav Port and Jagran Prakashan are some of the interesting mid-cap stocks that the fund holds.The fund is managed by Anand Radhakrishnan and Anil Prabhudas

Happy Investing!!

We can help. Call 0 94 8300 8300 (India)

Leave your comment with mail ID and we will answer them

OR

You can write back to us at PrajnaCapital [at] Gmail [dot] Com

---------------------------------------------

Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

These Application Forms can be used for buying regular mutual funds also

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

  1. ICICI Prudential Tax Plan Invest Online
  2. HDFC TaxSaver Invest Online
  3. DSP BlackRock Tax Saver Fund Invest Online
  4. Reliance Tax Saver (ELSS) Fund Invest Online
  5. Birla Sun Life Tax Relief '96 Invest Online
  6. IDFC Tax Advantage (ELSS) Fund Invest Online
  7. SBI Magnum Tax Gain Scheme 1993 Invest Online
  8. Sundaram Tax Saver Invest Online
  9. Edelweiss ELSS Invest Online

------------------

Best Performing Mutual Funds

    1. Largecap Funds Invest Online
      1. DSP BlackRock Top 100 Fund
      2. ICICI Prudential Focused Blue Chip Fund
      3. Birla Sun Life Front Line Equity Fund
    2. Large and Midcap Funds Invest Online
      1. ICICI Prudential Dynamic Plan
      2. HDFC Top 200 Fund
      3. UTI Dividend Yield Fund
    1. Mid and SmallCap Funds Invest Online
      1. Reliance Equity Opportunities Fund
      2. DSP BlackRock Small & Midcap Fund
      3. Sundaram Select Midcap
      4. IDFC Premier Equity Fund
    1. Small and MicroCap Funds Invest Online
      1. DSP BlackRock MicroCap Fund
    1. Sector Funds Invest Online
      1. Reliance Banking Fund
      2. Reliance Banking Fund
    1. Tax Saver MutualFunds Invest Online
      1. ICICI Prudential Tax Plan
      2. HDFC Taxsaver
      3. DSP BlackRock Tax Saver Fund
      4. Reliance Tax Saver (ELSS) Fund
    2. Gold Mutual Funds Invest Online
      1. Relaince Gold Savings Fund
      2. ICICI Prudential Regular Gold Savings Fund
      3. HDFC Gold Fund

Popular posts from this blog

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...
Read more

ICICI Prudential Balanced Fund

 ICICI Prudential Balanced Fund scheme seeks to generate long-term capital appreciation and current income by investing in a portfolio that is investing in equities and related securities as well as fixed income and money market securities. The approximate allocation to equity would be in the range of 60-80 per cent with a minimum of 51 per cent, and the approximate debt allocation is 40-49 per cent, with a minimum of 20 per cent. An impressive show in the last couple of years has propelled this fund from a three-star to a four-star rating. The fund has traditionally featured a high equity allocation, hovering at well over 70 per cent, which is higher than the allocations of the peers. But in the last one year, the allocation has been moderated from 78-79 per cent levels to 66-67 per cent of the portfolio. ICICI Prudential Balanced Fund appears to practise some degree of tactical allocation based on market valuations. Within equities, well over two-thirds of the allocation is parked i...
Read more

Equity investors should track market developments

The stock markets have been volatile over the last few days. They are in a sideways movement and trying to find the bottom after a fall of 20 percent a week ago. The market sentiments are not very positive at the moment and the recent developments are expected to dampen them further. Globally, governments and central banks are trying to cut rates and announce packages to improve business sentiments. These are some of the major developments in the markets last few month: A) Global On the global front, another large US bank went into a financial crisis. The US government took quick measures to avoid the spread negative sentiments in the markets. The US government announced a bail-out package and agreed to shoulder the losses on the bank's risky assets. China announced a large cut in interest rates and reserve ratio to boost the investor sentiments in the markets. Recently, the World Bank announced China's growth rate next year will come down to 7.5 percent. The European ...
Read more

Fortis Mutual Fund

Fortis Mutual Fund, a relatively new player, it is still to prove its case and define its position in the industry. In September 2004, it came onto the scene with a bang - three debt schemes, one MIP and one diversified equity scheme. And investors flocked to it. Going by the standards at that time, it had a great start in terms of garnering money. Mopping up over Rs 2,000 crore in five schemes was not bad at all. The fund house has not been too successful in the equity arena, in terms of assets. Though it has seven equity schemes, it is debt and cash funds that corner the major portion of the assets. Most of the schemes are pretty new, and the two that have been around for a while have a 3-star rating each. The last two were Fortis Sustainable Development (April 2007), which received a rather poor response, and Fortis China India (October 2007). Fortis Flexi Debt has been one of the better performing funds, after a dismal performance in 2005. It currently has a 5-star rating. None ...
Read more
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now