So you want to put your money into the tax saving mutual fund. As it has the potential of high return with the tax benefit. The Axis long term equity fund may be the first name in front of you. There is a lot of buzz around this equity linked saving scheme.
But, you want to be sure about this most talked ELSS. It is a right attitude. You should never go after an investment only because of the buzz. Rather, you should do the reality check yourself. In this post, I would help you in this effort.
I am trying to give you a clear picture of Axis Long Term Equity Fund. You should have all round information about the return of Axis Long Term Equity Fund. There should not be any chance of going wrong. After all, it is your hard earned money.
How Much Return Would You Get
The first thing must be coming in your mind is the future return. You put money into the ELSS with a great expectation. So, you should have an idea about the return. You should know that how much would be your investment after the 3-year lock-in period.
Unfortunately, we can’t predict about the return of the equity linked saving schemes. These schemes invest in the share market. You must be aware of the uncertainty of the share market.
No, I am not scaring you. But you should know the basic nature of the share market. It gives the highest return but with the highest uncertainty. You can also loose money!
Thus, Please understand, we can’t predict the return of Axis Long Term Equity Fund in particular and ELSS in general.
But, we can get an idea from the historical performance. We can know how the fund behaved when the share market went down. Whether it absorbed some shock or melted more than the market?
We can know how the Axis Long Term Equity Fund ran during the market rally. Whether it raced ahead or lagged behind?
We can know the performance of Axis Long Term Equity Fund in the long run. Whether it is a sprint runner or marathoner?
So. let us start with the return of Axis Long Term Equity Fund in the different period. We will analyse the return during last one year, 3 years and 5 years. We could have also taken the data of 10 years, but the Axis Long Term Equity Fund is only 6 years old.
This data would tell you about the long term potential of Axis Long Term Equity Fund.
|Duration||Return||Growth of Rs 10,000|
|3 years – (Average Return per year)||27.84%||20893|
|5 years – (Average Return per year)||19.57%||24441|
|As on 07/07/16|
Did you see the return of Axis Long Term Equity Fund during last one year? It is 1.34% ! Far less than saving account!
Don’t fret. Look at the return of 3 years and 5 years. It has been 27.84% and 19.57% per year respectively. These returns show how unpredictable the market can be.
However, If you have invested Rs 10,0000 into the Axis Long Term Equity Fund five years back, it would have been Rs 24,441 today.
Axis Long Term Equity Fund Returns During Downturns
Most of the people jump to the conclusion after going through the above data. But, Please give some more time and know the performance of Axis Long Term Equity Fund during bad times. Let us explore the return when share market went down.
You have to see whether Axis Long Term Equity Fund was in a better situation than the share market. To compare it, I have taken BSE 200 index as the share market barometer. BSE 200 index tell us about the movement of top 200 companies of share market.
I am also comparing Axis Long Term Equity Fund with the return of ELSS category.
The market went down during 2011. I am considering this year. Along with this, I am giving data of all other years to have a better idea of the consistency.
|Axis Long Term Equity Fund||BSE 200 Index||ELSS Categry|
We should give attention to 2011 and 2015. These years were not good for the share market. The BSE-200 has given negative return (Investors lost money) during these two years.
But, the Axis Long Term Equity Fund was in better position in the bad times. In 2011, when the share market fell down 27% the Axis Long Term Equity Fund slipped only 15%. Similarly in 2015, the BSE-200 index slipped 1.5% but the Axis Long Term Equity Fund managed to give 6.7% positive return.
This consistent outstanding performance makes the Axis Long Term Equity Fund best among the ELSS funds.
The above table is very important. it not only tells us that Axis Long Term Equity Fund performed better in every situation. But also you get to know that ELSS as a category has given a higher return than the share market. It means the fund manager has done a good job.
The Return of Axis Fund Among Peers
We have compared the Axis Long Term Equity Fund with the share market and category average. It has performed far better in this benchmark. But, We should also know its position among the peers. How the competitors are challenging the Axis Long Term Equity Fund. Is there any ELSS which is proving itself more promising? It is the real challenge!
But, We should also know its position among the peers. How are the competitors challenging the Axis Long Term Equity Fund? Is there any ELSS which is proving itself more promising? It is the real challenge!
|Axis Long Term Equity||-14.76||33.68||16.51||66.18||6.7|
|Birla Sun Life Tax Relief 96||-29.61||36.55||9.09||54.55||9.19|
|BNP Paribas Long Term Equity||-15||34.31||7.67||53.02||7.72|
|DSP BlackRock Tax Saver||-26.68||39.81||6.69||52.21||4.4|
|Franklin India Taxshield||-15.19||29.38||6.14||56.92||4.05|
Let us start with the year 2011. It was a year of the share market downturn. The Birla Sun Life Tax Relief 96 fell more than 29.5% but the Axis Long Term Equity Fund fell least among these top 5 ELSS. It was mere 15%
2012 was the year of the bounceback. This year, the Axis Long Term Equity Fund did not rise as much as other ELSS rose. However, it was not very far away.
2013 was the comeback year of the Axis Long Term Equity Fund. It was way ahead. None of the competitors could give the return in double digit but it gave about 16.5% return.
In 2014, all the ELSS gave a handsome return, the Axis Long Term Equity Fund was the leader.
In 2015, Axis Long Term Equity Fund was in the third position. However, the difference was not much.
Out of the last 5 years, the Axis Long Term Equity Fund has outperformed in 3 years. This consistent performance has made it an undisputed leader among the ELSS funds.
Comparison With Other Tax Saving Investments
Do you also want to compare the Axis Long Term Equity Fund Return against other tax saving investments? Do you want to assess the profit vs risk?
Let me tell you that besides ELSS and ULIP all other tax saving investments are debt based. They give almost fixed return and you know their interest beforehand. However, I am not comparing with the ULIP and traditional insurance plan. As It is very difficult to get their rate of return. These are opaque products and one should not invest into these scheme for tax saving purpose.
However, I am not comparing with the ULIP and traditional insurance plan. As It is very difficult to get their rate of return. These are opaque products and one should not invest into these scheme for tax saving purpose.
|Tax Saving Instrument||Return|
|Axis Long Term Equity Fund||19.5%|
|Sukanya Samriddhi Account||8.6%|
I believe, that now you have a fair idea of the Axis Long Term Equity Fund return. However, You should also learn the risk factor and management of the Axis Long Term Equity Fund. Besides, this checking out their portfolio would make your decision more informed. Once you take a decision, choose the online method to invest into this fund. Through the online investment, you can go for the direct plan of the Axis Long Term Equity Fund. It would give you a higher return than the regular plan.