Posted On Thursday, Dec 20, 2018
As we are about to commemorate 10 years of Quantum Tax Saving Fund (QTSF) on December 23, 2018 we get our Fund Manager Mr. Atul Kumar, Head - Equity Funds to answer few questions about the fund in a candid chat. Mr. Atul Kumar has been managing the fund since its inception.
Q1. Why should one consider Equity Linked Savings Scheme over other tax savings instruments?
Equity Linked Savings Scheme or ELSS is a tax efficient form of investment, which provides investors an opportunity for capital appreciation through exposure to equities.
Q2. What is the trend you are witnessing for your ELSS fund? Are more and more investors preferring to invest in ELSS schemes?
We have seen a positive growth in our ELSS fund year on year. We started our tax saving fund in December 2008 and we continue to see more investors investing every fiscal year. Increased participation in Equity Diversified Funds is also helping investors to look at ELSS as a very useful tax saving option.
Q3. We find that more and more investors across India prefer to participate in equity funds via SIP route. Is it true for ELSS schemes also?
Yes it's true, people have started understanding the importance of investment in ELSS through SIP mode, however by far ELSS still remains a market agnostic product as investors rush to deploy their money in ELSS in the month of January to save tax.
Q4. How to choose a better performing ELSS mutual fund scheme?
The investor should essentially look at the long term track record of the fund both in terms of returns & risk. While returns could be great, they shouldn’t be viewed in isolation, one should also see the amount of risk taken to generate those returns. Also the investment approach & portfolio of the fund are extremely critical. One cannot ignore the expense ratio, or how much it is going to cost an investor to invest in the fund. These things are important as investors will not be able to withdraw money for the next three years after investing, thanks to the lock-in period which is a fundamental nature of an ELSS product.
Q5. Going forward how do you see the equity markets performing in the long run?
There has been a good correction in stock prices in recent months. Over the long term, we remain optimistic on Indian equities. India is likely to grow faster than many nations. Investors can expect decent return from equities over a long period in future. Investors should put more money given that valuations appear more reasonable. They now appear less risky than earlier.
Our portfolio of the Quantum Long Term Equity Value Fund (QLTEVF) will rise only when markets are reasonably priced and not when the market valuations look stretched. We have been communicating the same to our investors over many years. On a longer period of time, we will try to provide decent risk-adjusted returns. But there will be periods when markets are extremely frothy. In such times, we are likely to under-perform the benchmarks and some of our peer funds.
|Name of the Scheme & Primary Benchmark
|This product is suitable for investors who are seeking*
|Risk-o-meter of Scheme
|Quantum Long Term Equity Value Fund
An Open Ended Equity Scheme following a Value Investment Strategy
|• Long term capital appreciation
• Invests primarily in equity and equity related securities of companies in S&P BSE 200 index.
Investors understand that their principal will be at Moderate Risk
|Quantum Tax Saving Fund
(An Open Ended Equity Linked Saving Scheme with a Statutory Lock in of 3 years and Tax Benefit)
|• Long term capital appreciation
• Invests primarily in equity and equity related securities of companies in S&P BSE 200 index and to save tax u/s 80 C of the Income Tax Act. Investments in this product are subject to lock in period of 3 years.
Investors understand that their principal will be at Moderately High Risk
Disclaimer, Statutory Details & Risk Factors:
The views expressed here in this article / video are for general information and reading purpose only and do not constitute any guidelines and recommendations on any course of action to be followed by the reader. Quantum AMC / Quantum Mutual Fund is not guaranteeing / offering / communicating any indicative yield on investments made in the scheme(s). The views are not meant to serve as a professional guide / investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument or mutual fund units for the reader. The article has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst no action has been solicited based upon the information provided herein, due care has been taken to ensure that the facts are accurate and views given are fair and reasonable as on date. Readers of this article should rely on information/data arising out of their own investigations and advised to seek independent professional advice and arrive at an informed decision before making any investments. Please visit – www.quantumamc.com/disclaimer to read scheme specific risk factors.
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