Looking for potential investment avenues with competitive returns where you can also save on taxes? Equity Linked Savings Schemes (ELSS) funds serve this dual goal, emerging as a popular mutual fund category in recent years.
As an Indian investor, you enjoy the provision for a dedication of up to INR 1.5 lakhs per annum under section 80C. This makes them a smart choice for those looking to reduce their taxable income while growing their wealth over the long term.
ELSS funds provide a high growth potential, thanks to their exposure to equity. However, how do you narrow down your choice when choosing the best-performing ELSS funds? In this blog, we have shortlisted the top five funds under this category you must consider.
5 Best ELSS Funds to Invest in FY 2024-25
Check out our recommended picks among the best ELSS mutual funds and diversify your portfolio.
- Motilal Oswal ELSS Tax Saver Fund Direct – Growth
The consistent performance of Motilal Oswal ELSS Tax Saver fund makes it the best choice for investors. This fund predominantly invests in large-cap stocks, along with some mid-cap stocks with a high growth potential.
Investors benefit from long-term capital appreciation, thanks to the research-oriented approach of Motilal Oswal. Aggressive investors looking to grow their wealth while saving on taxes find this ELSS fund to be a great choice.
- NAV: INR 62.5649 as of 04 Dec 2024
- AUM: INR 4073 crore
- Expense Ratio: 0.65%
- 1-Year return: 55%
- 3-Year return: 28%
- 5-Year return: 25%
- SBI Long Term Equity Fund Direct – Growth
The SBI Long Term Equity Fund is managed by one of the largest financial institutions in the country. This fund diversifies its assets across various sectors, but primarily focuses on the large caps. The fund managers have also included some select mid cap stocks in its portfolio.
- NAV: INR 471.8365 as of 04 Dec 2024
- Market Cap: INR 27559 crore
- Expense Ratio: 0.94%
- 1-Year return: 39%
- 3-Year return: 26%
- 5-Year return: 25%
- HDFC ELSS Tax Saver Fund Direct – Growth
With a relatively conservative approach, the HDFC ELSS Tax Saver Fund primarily invests in blue-chip large-cap stocks. It has been a stable performer and its portfolio also consists of some high-potential mid-cap stocks.
This fund is suitable for long-term wealth creation and generates impressive returns with lower volatility.
- NAV: INR 1,460.8070 as of 04 Dec 2024
- Market Cap: INR 15,935 crore
- Expense Ratio: 1.09 %
- 1-Year return: 30%
- 3-Year return: 23%
- 5-Year return: 22%
- Quant ELSS Tax Saver Fund Direct – Growth
This fund takes a more dynamic and growth-oriented approach. It focuses on value-driven sectors and emerging sectors.
The Quant ELSS is known for its diversification across different market caps, and offers a well-rounded portfolio with growth potential.
- NAV: INR 413.9427 as of 04 Dec 2024
- Market Cap: INR 10979 crore
- Expense Ratio: 0.65 %
- 1-Year return: 27%
- 3-Year return: 20%
- 5-Year return: 33%
- JM ELSS Tax Saver Fund Direct – Growth
With a mix of large-cap and mid-cap funds, the portfolio of JM ELSS Fund looks balanced. It has delivered handsome returns in the long run, capitalizing on sectoral trends.
This makes it an appealing choice to investors looking for both consistency and high growth with tax benefits.
- NAV: INR 56.8984 as of 04 Dec 2024
- Market Cap: INR 180 crore
- Expense Ratio: 1.27%
- 1-Year return: 38%
- 3-Year return: 22%
- 5-Year return: 23%
Conclusion
If you have yet to invest in tax-saving funds, ELSS funds are a practical and effective way to grow your wealth. We have curated the best tax-saving funds for you to start saving for the long term. When you buy mutual funds, you can choose from this list based on their historical returns and unique features. ELSS funds can be a valuable addition to a well-rounded portfolio.
