DSP Merrill Lynch Fund Managers Ltd has launched DSP Merrill Lynch Tax Saver Fund, an open-ended equity linked savings scheme (ELSS). The new fund offer will open on November 27 and close on December 21.

The fund seeks to generate medium to long-term capital appreciation from a diversified portfolio of equity and equity related securities (80-100 per cent) and debt markets (0-20 per cent).

Investment in an ELSS allows deductions of up to Rs 1 lakh from total income in a financial year. The fund has a three-year lock-in period.

"DSP Merrill Lynch Tax Saver Fund will give the fund manager the flexibility to diversify across a range of market capitalisations to optimise returns," said Mr Anup Maheshwari, Head - Equities and Corporate Strategy, DSP Merrill Lynch Fund Managers Ltd.