DSP BlackRock Tax Saver is managed by Apoorva Shah. The scheme seeks to generate medium to long-term capital appreciation from a diversified portfolio that is substantially constituted of equity and equity related securities. This is a good fund to hold on to for short term needs.
DSP BlackRock Tax Saver is a tax planning fund with mid cap bias which means most of your money will be invested in stocks of medium sized companies. About 31.21% of the fund’s money is allocated to stocks of mid-sized companies, 56.4% to stocks of large sized companies and close to 10.38% to those of small companies. Mid-sized stocks can give kicker returns as they turn into large stocks but this happens not so frequently.
- Saving on tax outgo
- Child's education
- Child's marriage
- Planning for retirement
- Home Purchase
- Creating wealth
- Short term needs
- Lifestyle needs
If you had invested Rs 1 lakh when the fund was launched in Jan 2007, your value of investments would be around Rs 1.82 lakhs. If you had invested Rs 1 lakh for 5 years, your value of investments would be around Rs 1.31 lakhs. The performance has been similar to other mutual funds in this category. The fund has been giving at around 5.6% returns every year for those who stayed invested for last 5 years.
Assume you had invested Rs 10,000 every month in DSP Black Rock Tax Saver through SIP for the past 5 years today you would have around Rs 8.07 lakhs.
Needless to say no one can predict the future of markets. We have firm belief in the future prospects of the Indian economy. If the Indian economy grows at 9% then the leading companies tend to do well. When the companies do well their stock prices follows their performance. So if you expect the economy to grow at 8% then you can expect top performing mutual funds to give you returns in excess of 14%.
Mutual fund schemes that have exposure to mid-sized companies tend to show results when their bet on few companies comes true. We advise you to avoid too much of star gazing and future prediction. Be reminded that equities are one of the asset classes that have the potential to beat inflation. Your aim for core portfolio should be to beat inflation.
There is a lock-in period of 3 years on this fund, which means that you cannot sell this fund within 3 years of your purchase date. Withdraw when your goals are closer to achievement. Do not remove the money when the markets go up or down. Do not panic. Stick to your goals.
Once you invest in the fund do not get into the habit of checking the NAV daily or monthly. Review the performance once a year. Too much attention is not good.
A onetime fee of Rs 100 is charged on investments over Rs 10, 000 made through distributors. If you are a first time investor in mutual funds an additional Rs 50 is charged to cover KYC expenses. This is deducted from your investment and can be skipped if you buy directly from the mutual fund via their website or offices.
No exit load applies for units withdrawn from this scheme. Expense ratio of DSP BlackRock Tax Saver is 2.65%. This is charged to recover the fund management company’s expenses on securities’ transactions, commissions, registrar fees, etc. Your mutual fund returns will be total returns less expense ratio.
The returns in a mutual fund are absolutely tax free, provided you do not withdraw within 1 year. DSP BlackRock Tax Saver qualifies for sec 80C ELSS benefits, which means you can invest up to Rs 1 lakh a year in this fund and deduct the amount from your gross total income for computing income tax.