The Best ELSS Tax Saving Fund To Invest In 2020
It is that time of the year when I share the process to find the best tax saving ELSS fund one should invest in 2020 as well as look back on the past best tax saving funds to learn something new.
Let me kick off the 2020 series with the best ELSS tax saving fund.
The Top ELSS Funds for 2020
We start with ValueResearchOnline’s 4 and 5 star rated direct ELSS funds. Arrange them in decreasing order of the asset under management by each fund. Now we have the top ELSS tax saving funds:
Moving from the top funds to best funds based on expense ratio alone.
Best Tax Saving ELSS funds for 2020
For me, the best fund is the one that has the least expense ratio.
Mirae Asset Tax Saver
Mirae Asset Tax Saver has the lowest expense ratio as compared to its peers by a considerable margin.
So it is was my choice of a fund in 2019 and remains the choice of fund for 2020 as well.
The expense ratio was and will be a crucial factor in the fund’s performance going forward.
Tata India Tax Savings
The next best fund is Tata India Tax Savings because it also has a better expense ratio.
If one has to diversify in an ELSS fund and want to consider a different fund than 2019, then Tata India Tax Savings is an ideal choice.
How has The Best ELSS Tax Saving Funds for 2019 Performed?
In 2019, my choices of funds were:
- Mirae Asset Tax Saver Fund – It is one of the best performing funds in the ELSS tax saving category and remains as the best fund for the year in 2020 as well. Over 17% return in 2019 is remarkable.
- Aditya Birla Sun Life Tax Relief 96 – The fund didn’t perform as well as one would have expected. Subpar return of only ~7% in the past year. I expected IT, Pharma and FMCG will outperform in 2019, but I was wrong. I think we have to wait a little longer for Pharma and FMCG sector to outperform.
The best 2019 ELSS funds have performed well, and I expect the fund to be doing good as well.
This review is neither a sponsored one nor an endorsement that you should invest only in the above mention funds.
I have shared the complete process I am using to find the best performing ELSS tax saving fund for 2020. Feel free to apply your choice of criteria that gives you comfort while investing.
Make sure to invest in direct funds. Moreover, never invest in a fund because someone has recommended it to you. Always apply your investment logic to each of your investments.