PPFAS Tax Saver Mutual Fund

Investment Objective

PPFAS ELSS Mutual Funds are defined as diversified equity funds that aim to allow investors to grow their wealth over time. The fund's mandate directs it to invest primarily in equity and related instruments in a predetermined proportion. Following an in-depth study, the fund manager will opt for the best stocks to ensure that PPFAS ELSS Mutual Fund returns remain in accordance with expectations. These funds have a three-year lock-in period. Investing in PPFAS ELSS Mutual Fund schemes entitles you to a tax deduction of up to Rs 1.5 lakh under Section 80C of the Indian Income Tax Act. In this case, the amount invested is deducted from income taxable, thus reducing your total tax liability.

Risks Involved in PPFAS ELSS Mutual Fund

PPFAS ELSS Mutual Fund risk ranges between moderate to high against the balanced and debt funds. The fund's value may fluctuate in response to fluctuations in the underlying stock value. PPFAS ELSS Mutual Fund risk is lower than the pure small-cap or mid-cap and sector or theme-based funds due to their well-diversified portfolios. Additionally, the risks may spread over longer periods of investment. Before investing in the scheme, investors must consider their own tolerance towards risk. These risks fluctuate the PPFAS ELSS Mutual Fund performance.

Return Potential of PPFAS ELSS Mutual Fund

Investing in the best PPFAS ELSS Mutual Fund schemes provides capital appreciation and monthly payouts. Capital appreciation occurs when the underlying stock values rise over a particular investment horizon. The three-year lock-in period allows the fund manager to make asset allocation decisions without the worry of frequent fund redemptions. In the long run, PPFAS ELSS Mutual Fund returns are high. The PPFAS ELSS Mutual Fund return, on average, can be put between 12% - 15% over a five-year tenure. It must be noted that PPFAS ELSS Mutual Fund returns are not guaranteed, and PPFAS ELSS Mutual Fund performance may fluctuate from one period to the next.

Who Should Invest in PPFAS ELSS Mutual Fund?

PPFAS ELSS Mutual Fund schemes are suitable for investors with a higher risk tolerance. When compared to other tax-saving options, these funds offer the shortest lock-in period of three years. It makes them excellent for long-term wealth growth in a tax-efficient manner. Investors can use the best PPFAS ELSS Mutual Fund to attain long-term goals such as child education, retirement preparation, and property ownership. To fully realise the potential of these products, you must remain invested throughout the lock-in period. This may also include putting surpluses in these funds that you won't require in the near future.

Things To Consider Before Investing in PPFAS ELSS Mutual Fund

The following things must be considered before investing in PPFAS ELSS Mutual Fund. These factors affect the PPFAS ELSS Mutual Fund performance.

• Expense Ratio
• Portfolio Composition
• PPFAS ELSS Mutual Fund risk
• Returns
• Investment Horizon

Tax on PPFAS ELSS Mutual Fund

Indian investors who engage in PPFAS ELSS Mutual Fund schemes are eligible for an Rs. 1.50 lakh income tax deduction under Section 80C of the Indian Income Tax Act. This, however, is not a limit. Amounts in excess of this can also be invested in the PPFAS ELSS Mutual Fund. It enjoys the same Capital Gains Tax advantages as other India-focused Equity Schemes (i.e., gains are taxed at a flat rate of 10%*).