Sundaram MF plans tax saving fund

MUMBAI, JULY 7: Sundaram Mutual Fund plans to launch an open-ended tax saving scheme in the near future, subject to the SEBI’s clearance. This scheme will help the investors to save regularly in an equity scheme and offer tax benefits offered under section 88 of the IT Act. “By spreading out the tax savings over the entire year, the investors are exposed to less market risk and have the convenience of systematic savings,” according to TP Raman, managing director, Sundaram Newton Asset Management Company Ltd.

Raman has said that Sundaram Growth Fund, an open ended equity fund from the Sundaram stable has given a return of 49.9 per cent since inception of April 1997 against the BSE 200 Index, which gave a return of 7.34 per cent. The performance of the fund has been good notwithstanding the volatility of Indian stock market.

Raman emphasised that the fund is suited for people who are looking for a well managed vehicle to take part in the Indian capital market. He pointed that only after investing a reasonable sum in a core equity production like Sundaram Growth Fund, the investor should seek to invest in sector specific funds whose risk levels are inherently higher than a fund which is diversified across various sectors.

Under the Systematic Investment Plan, an investor can invest small amount of money regularly in the fund. The fund also offer tax benefits under Section 54 EA and 54 EB and indexation on capital gains. The fund has an entry load of two per cent for investments upto Rs 25 lakh and 1.5 per cent investment above Rs 25 lakh. There is no exit load in the fund.