Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: cpt :: due date for vat payment :: TDS :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: Central Excise rule to resale the machines to a new company :: articles on VAT and GST in India :: TAX RATES - GOODS TAXABLE @ 4% :: form 3cd :: VAT Audit :: ACCOUNTING STANDARD :: VAT RATES :: list of goods taxed at 4%
 
 
News Headlines »
 Is government tapping your phone?
 Income tax department to use analytics to look for discrepancies in bank accounts
 GST Council fails to break deadlock over indirect tax regime, next meet on Dec 11 and 12 to hammer out differences
 Invoking Writ Jurisdiction For Income Tax Matters
 How to file income-tax returns online
 How Income Tax Returns Are Scrutinised
 All About New Income Disclosure Scheme to make Demonetisation successful
 Your deposit may draw income tax notice
 Accepting payment under IDS 2016
 New disclosure scheme could see 50% tax and 4-year limit on cash use for unaccounted deposits
 Pay 50% tax on unaccounted deposits, or 85% if caught, says Modi government

Taxing times for floundering tax saving schemes
July, 09th 2008

Sub Heading : These schemes have on an average fallen in excess of 41% in the last six months

If you are an investor in equity-linked saving schemes (ELSS), chances are you have lost more than index investors, even after considering the fact that you saved on taxes. That is because the net asset value (NAV) of most tax-saving schemes have actually fallen more than Sensex or Nifty, and even broader indices like the BSE-100 and BSE 200. The NAVs of these schemes have, on average, fallen in excess of 41% in the last six months, against a 35% fall in Sensex, 39% fall in the BSE 100 and 40% fall in the BSE 200.

Compared to tax-saving schemes, balanced funds have given negative returns of 31.6%, while diversified funds have fallen, on average, by 38.3%.

Experts believe these schemes have been hit the most, owing to their wider mid-cap focus and passive management style, which tend to impact the returns when the market corrects sharply. "Since the fund managers of these schemes are ensured funds that are blocked for a long-time horizon, they tend to focus more on mid-caps and small-caps. As a result, these schemes tend to under-perform the market when there is a sharp correction," said Dhirendra Kumar of Value Research Online.  He said investment over 3-5 years would stabilize the returns even for such schemes and, so, investors would get better yields over longer term owing to dual benefits. "We believe this is actually the right time to invest in tax-saving schemes, as they are available at discounted NAVs," he added.

However, analysts believe tax-saving plans are not meant only for usual tax benefits, but also for long-term savings with stable returns.

"The purpose of introducing tax-saving funds was to ensure that investors see mutual funds as saving instruments and not only an equity-linked investment avenue and, therefore, there is a lock-in period of three years," said an expert with one of the leading mutual fund houses. He, however, agreed that such a fall in the last six months could actually impact the investors' waiting period and could take longer to recover.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Application Management Solutions Application Management System Application Management Software System Application Management Development Application Management Software Development

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions