Skip to main content

DSP BlackRock Tax Saver Fund - A ELSS Fund for 2016

 

DSP BlackRock Tax Saver Fund Invest Online

 
Equity Linked Savings Scheme article in Advisorkhoj - DSP BlackRock Tax Saver Fund: Nearly 2X returns in last 3 years makes it a top ELSS fund
 

ELSS funds offer triple benefits of tax savings, capital appreciation and tax free returns to the investor. The DSP BlackRock Tax Saver fund, one of the top ELSS funds, has outperformed the tax saving funds category by delivering two times returns in the last three years. The fund has consistently given superior returns relative to the ELSS funds category and the broader market, over the different time periods. The chart below shows the annualized trailing returns of the DSP BlackRock Tax Saver fund growth option, regular plan, over the last 1, 3 and 5 year time periods, compared to the ELSS funds category and the CNX 500 index. NAVs as on June September 19 2014.

Equity Linked Saving Schemes - Annualized trailing returns of the DSP BlackRock Tax Saver fund growth option, regular plan, over the last 1, 3 and 5 year time periods, compared to the ELSS funds category and the CNX 500 index

Fund Overview

The DSP BlackRock Tax Saver Fund was launched in November 2006 and has performed very well relative to the market since its inception. The fund has 814 crores of assets under management. The expense ratio of the fund is 2.66%. The manager of this fund is Apoorva Shah. Apoorva has delivered good returns for all the funds that he is managing for DSP BlackRock. The minimum investment for this fund is 5000. Morningstar has a 4 star rating for this fund. The fund is suitable for investors planning to make 80C investments for long term investment objectives, like retirement planning, children's education etc. The fund is open for both growth and dividend options.

Portfolio Composition

The fund has a large cap, growth oriented focus. The fund manager has a bottoms-up portfolio construction approach. The fund manager tries to identify stocks with high growth potential for this portfolio. He also invests in stocks that are trading at attractive valuations. The portfolio is overweight on cyclical sectors like BFSI, Oil & Gas, Automobile & Auto Ancillaries etc. To balance its exposure to cyclical, the portfolio also has allocations to defensive sectors, with IT and Pharmaceuticals comprising nearly 15% of the portfolio holdings, as on May 31 2014. With cyclical sectors poised to do well with the revival in economic growth and capex cycle, the DSP BlackRock Tax Saver fund has the potential to deliver good returns over the short to medium term. The portfolio is very well diversified in terms of company concentration. The top 5 companies in the fund portfolio, ICICI Bank, Infosys, TCS, Larsen & Toubro, and SBI account for only 20% of the portfolio value. Even the top 10 companies in the fund's portfolio account for less than 34% of the portfolio holdings.

Equity Linked Saving Schemes - Sector Composition and Top 5 Holdings of DSPBR Tax Saver Fund

Comparison with Peer Sets

DSP BlackRock Tax Saver fund is one the top performing ELSS funds. The chart below shows the comparison of 1 year, 3 years and 5 years annualized returns of the DSP BlackRock Tax Saver with other top performing ELSS funds.

Equity Linked Saving Schemes - Comparison of 1 year, 3 years and 5 years annualized returns of the DSP BlackRock Tax Saver with other top performing ELSS funds

Risk and Return

The DSP BlackRock Tax Saver fund has consistently outperformed the ELSS funds category and the CNX 500 over the last 3 years. The fund gave a trailing return of over 58% and 24% in the last one and three years respectively. In terms of risk measures, the annualized standard deviation of monthly returns of the DSP BlackRock Tax Saver fund is in line with the ELSS funds category. However, on a risk adjusted returns basis, as measured by Sharpe Ratio, the DSP BlackRock Tax Saver fund has outperformed the ELSS funds category. Sharpe ratio is defined as the ratio of excess return (i.e. difference of return of the fund and risk free return from Government securities) and annualized standard deviation of returns. Higher the Sharpe ratio better is the risk adjusted performance of the fund. See charts below for comparison of volatilities and Sharpe ratios of the DSP BlackRock Tax Saver and the ELSS Funds Category

Equity Linked Saving Schemes - Volatility Comparison and Sharp Ratio Comparison - DSPBR Tax Saver Fund vs. ELSS Category

1 lac lump sum investment in the fund NFO (growth option) would be at a value of 2.93 lacs as on Sep 19 2014. The chart below shows the growth of 1 lac investment in the DSP BlackRock Tax saver fund (growth option).

Equity Linked Saving Schemes - Growth of 1 lac investment in the DSP BlackRock Tax saver fund (growth option)

The chart below shows the returns since inception of 3000 monthly SIP in the DSP BlackRock Tax Saver fund (growth option). The SIP date has been assumed to first working day of the month. The chart below shows the SIP returns of the fund.

Equity Linked Saving Schemes - SIP returns since inception of DSP BlackRock Tax saver fund (growth option)

The chart above shows that a monthly SIP of 3000 started at inception of the DSP BlackRock Tax saver fund (growth option) would have grown to over 5.7 lacs by Sep 19 2014, while the investor would have invested in total only about 2.8 lacs. The SIP return (XIRR) is over 18% since inception.

Conclusion

The DSP BlackRock tax saver fund has delivered over 7 years of strong performance. This fund is suitable for 80C investors with a long time horizon. Investors can consider investing in the scheme through the systematic investment plan (SIP) or lump sum route. Investors should consult with Prajna Capital, if DSP BlackRock Tax Saver fund is suitable for their tax planning needs.

-----------------------------------------------
Invest Rs 1,50,000 and Save Tax under Section 80C. Get Great Returns by Investing in Best Performing ELSS Mutual Funds

Top 10 Tax Saving Mutual Funds to invest in India for 2016

Best 10 ELSS Mutual Funds in india for 2016

1. BNP Paribas Long Term Equity Fund

2. Axis Tax Saver Fund

3. Franklin India TaxShield

4. ICICI Prudential Long Term Equity Fund

5. IDFC Tax Advantage (ELSS) Fund

6. Birla Sun Life Tax Relief 96

7. DSP BlackRock Tax Saver Fund

8. Reliance Tax Saver (ELSS) Fund

9. Religare Tax Plan

10. Birla Sun Life Tax Plan

Invest in Best Performing 2016 Tax Saver Mutual Funds Online

Invest Online

Download Application Forms

For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call

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

Leave your comment with mail ID and we will answer them

OR

You can write to us at

PrajnaCapital [at] Gmail [dot] Com

OR

Leave a missed Call on 94 8300 8300

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

Popular posts from this blog

What is Electronic Clearing Service (ECS)?

  As the name suggests, it's an electronic process through which money can be transferred from one bank account to another. According to RBI, this mode is usually used for regular payments and receipts, like distribution of dividend, interest, salary, pension etc. This mode is also used for collection of bills for telephone, electricity, water, various types of taxes, payment of EMIs , investments in mutual funds , payment of insurance premium etc. There are two types of ECS , like most other banking transactions, ECS credit and ECS debit. An ECS credit is used by a bank account holder , usually a large company or an institution for services like payment of dividend, in terest, salary, pension etc. If your mutual fund pays you dividend to your bank account, of all probability it is being paid through ECS credit.ECS debit, on the other hand, is used when a company or an institution is getting money from a large number of people. For example if you are investing in a mutual fund sc...

Equity Savings Fund

Invest Equity Savings Fund Online   The best part about these funds is that they are subject to equity fund taxation and at the same time are structured like MIP like funds . This new category, equity savings funds , offer a little of everything. They allocate money to equities & equity related instruments, and fixed income. They aim to generate returns by diversification. Such funds invest in fixed income and arbitrage to protect the investors from short term volatility and equity for capital gains. The best part of these funds is that they are subject to equity fund taxation and at the same time are structured like MIP funds.   MIP funds however are subject to debt fund taxation. Investors Equity savings funds are suitable for the following: First time investors who seek partial exposure to equity with less volatility and greater stability Investors seeking moderate capital appreciation with relatively lower risk Those wh...

WEALTH TAX

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 WEALTH TAX   WHAT CONSTITUTES WEALTH? For wealth tax purposes, "wealth" means property , urban land, car, jewellery , yacht, boat, aircraft and cash in hand in excess of Rs 50,000. CAUTION POINT | Do not think you will have an easy escape from wealth tax by transferring your `wealth' without consideration to your spouse or minor child. Such assets will also be considered as your wealth. HOW TO DETERMINE YOUR TAXABLE WEALTH Add the taxable value of the above assets (computed as per the detailed rules for valuation) owned by you as on March 31 (for FY 2014-15, it will be March 31, 2015). In case you sold your car during the year, it will not be taxable wealth. Deduct loans if any obtained by you to acquire any of the taxable assets from the value of gross tax out for at least 300 days in a...

How to Pick Top Performing Mutual Fund Schemes

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   How to Pick Performing Schemes  Funds that continue to stay in the top grade of performance over longer periods are the ones to bet on, advise investment experts   The mutual fund performance charts of the past few months make for an impressive reading. Funds across all categories boast of stellar returns. Sample this: The mid and small cap category has averaged 77 percent return over the past 12 months, with the best fund delivering a staggering 120 percent. The tax-saving funds also average an impressive 51 percent, including a fund which has soared 92 percent. Many of the table-toppers are funds of proven quality and track record. However, there are also schemes that are not that well-known. Some of these have rarely made it to the performance charts in the past, yet, of late, they bo...

Section 80CCD

Top SIP Funds Online   Income tax deduction under section 80CCD Under Income Tax, TaxPayers have the benefit of claiming several deductions. Out of the deduction avenues, Section 80CCD provides t axpayer deductions against investments made in specific sector s. Under Section 80CCD, an assessee is eligible to claim deductions against the contributions made to the National Pension Scheme or Atal Pension Yojana. Contributions made by an employer to National Pension Scheme are also eligible for deductions under the provisions of Section 80 CCD. In this article, we will take a look at the primary features of this section, the terms and conditions for claiming deductions, the eligibility to claim such deductions, and some of the commonly asked questions in this regard. There are two parts of Section 80CCD. Subsection 1 of this section refers to tax deductions for all assesses who are central government or state government employees, or self-employed or employed by any other employers. In...
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