What happens to my money if mutual fund company fails?
Even if the fund-management company goes bankrupt, its creditors can’t touch the money in the mutual fund, which is held in a separate trust for investors. The custodian must keep the mutual fund’s assets separate from its other accounts and can’t touch the money even if the bank fails.
Is ELSS a risk?
You can continue to invest in this scheme even after the completion of the lock-in period of three years. The risk involved with ELSS is higher when compared to a fixed deposit or a PPF, but the returns are potentially more elevated as well.
How do you protect mutual funds?
8 Ways to Protect Mutual Funds From a Financial Crisis
- Choose Bond Funds.
- Get Foreign Exposure.
- Avoid Leveraged Funds.
- Reduce Risk.
- Consider Noncyclical Funds.
- Use Alternative Funds.
- Spread the Risk.
- Stick It Out.
Can mutual funds lose money?
With mutual funds, you may lose some or all of the money you invest because the securities held by a fund can go down in value. Dividends or interest payments may also change as market conditions change.
Why should you invest in ELSS mutual funds?
Most investors prefer to invest in this mutual fund instrument as it offers capital appreciation and tax benefits as well. This instrument come with a 3 year lock-in period. With the financial year 2014-2015 coming to a close, investment in ELSS are on the rise.
Are ELSS investments tax deductible?
Investments in an ELSS or Equity Linked Saving Scheme qualify for tax deductions under Section 80C of the Income Tax Act. You can invest up to Rs 1.5 lakh in a financial year in a tax saving mutual fund scheme and claim tax deductions on your investments.
What is ELSS (equity linked saving scheme)?
As the name suggests, Equity Linked Saving Scheme or ELSS is a type of mutual fund scheme that primarily invests in the stock market or Equity. Investments of up to 1.5 Lac done in ELSS Mutual Funds are eligible for tax deduction under section 80C of the Income Tax Act.
How much can I invest in ELSS under Section 80C?
Under section 80C, one can avail tax benefit of upto ₹46,800 by investing upto ₹1.5 lakhs per year in ELSS. You can also invest more than ₹1.5 lakhs in ELSS, but tax benefit can not be availed on the investment exceeding ₹1.5 lacs.