SBI Magnum Taxgain Scheme

SBI Magnum Taxgain Scheme is being managed by Jayesh Shroff.This fund qualifies for tax benefits under section 80C of IT Act. It is not among the best performers in its category.

Where does SBI Magnum Taxgain Scheme invest your money?

SBI Magnum Taxgain is a large cap fund which means most of your money will be invested in large size companies. Large cap companies tend to be stable compared to mid cap and small cap companies. This fund has 72% exposure to stocks of large cap companies and 22% exposure to stocks of mid cap companies and 6% to stocks of small cap companies.

Suitable for what?
  • Saving on tax
  • Child's education
  • Child's marriage
  • Planning for retirement
  • Home Purchase


Not suitable for?
  • Lifestyle needs
  • Creating wealth
  • Short term needs
How much to invest?

Minimum one time investment is Rs 5000 and minimum SIP is Rs 500 per month. Do not make SBI Magnum Taxgain as part of your core portfolio. Core portfolio is investments that are made for your basic goals and makes up about 70% of your investment portfolio. SBI Magnum Taxgain can be part of your satellite portfolio. Do not do the mistake of investing in too many mutual fund schemes. At any point of time do not have more than two mutual fund schemes in your core portfolio.

Our recommendation for fresh investment
Not Recommended
Our recommendation for existing investment
How has SBI Magnum Taxgain Scheme performed in the past?

If you had invested Rs 1 lakh when the fund was launched at March 1993, your value of investments would be around Rs 19.7 lakhs. If you had invested Rs 1 lakh five years back it would have become Rs 1.2 lakhs. The performance has been not better than or similar to other mid cap mutual funds. The fund has been giving at around 4% every year for those who stayed invested for last 5 years.

Assume you had invested Rs 10,000 every month in SBI Magnum Taxgain through SIP for the past 5 years today you would have around Rs 6.8 lakhs.

How SBI Magnum Taxgain Scheme will perform in the future?

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 size 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.

When to review?

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.

What charges apply?

If units are sold within a year an exit load of 1% is deducted from your total returns. No exit load applies for units withdrawn post one year. Expense ratio of SBI Magnum Taxgain Scheme is 2.02%. 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.

When to exit?

There is a lock-in period of 3 years on this fund, which means that you cannot sell these funds 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.

What are the tax implications?

The returns in a mutual fund are absolutely tax free, provided you did not withdraw within 1 year. Kotak 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.

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