What are ELSS Funds?

What are ELSS Funds?

An equity-linked saving scheme (ELSS) is an equity mutual fund scheme which invests a minimum of 80% of its total assets in equity and equity-related instruments. It is an open-ended scheme with a lock-in period of 3 years.

When you invest in an ELSS fund, you can avail deduction from your taxable income under Section 80C of the Income Tax Act. Features of an ELSS fund are as follows:
  1. Income tax benefits under Section 80C of the Income Tax Act
  2. Minimum Rs. 500 and no maximum investment amounts
  3. Potential to give inflation-beating high returns
  4. Low lock-in period compared to other tax-saving investment products
  5. Investment options: Lump sum and SIP
  6. No exit load
  7. Diversification as fund manager invests the scheme money into large, mid, and small-cap stocks across market capitalisation

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