ELSS funds are special types of mutual funds that are required to invest at least 80% of their money in company stocks and related investments. This rule comes from the Equity-Linked Savings Scheme 2005 set by the Ministry of Finance.
ELSS funds are flexible in how they invest, spreading your money across companies of different sizes (large, medium, and small) and various business sectors. They can use different investment styles, like focusing on growth or value, or a mix of both. This approach can help you benefit from a wide range of investments and professional fund management.
These funds also have a mandatory lock-in period of 3 years, meaning you cannot withdraw your money before this time. The main benefit is that they offer tax deductions under Section 80C of the Income Tax Act if you choose the old tax regime.
In this article, we will explore some of the top-performing ELSS funds in India based on their historical returns over 3 years, which is when the lock-in period ends.
| Scheme Name | 3-Year CAGR (%) | Risk (SD Annualised) | Sharpe Ratio | Sortino Ratio | Primary Cap Bias | Key Sectors |
| Motilal Oswal ELSS Tax Saver Fund | 26.4 | 19.07 | 0.39 | 0.67 | Mid & Smallcap | Capital Goods, Finance, Retail |
| SBI ELSS Tax Saver Fund | 26.3 | 12.92 | 0.50 | 1.19 | Largecap | Banks, Auto & Ancillaries, IT |
| HDFC ELSS Tax Saver | 23.9 | 11.96 | 0.48 | 1.14 | Largecap | Banks, Auto & Ancillaries, Healthcare |
| ITI ELSS Tax Saver Fund | 21.9 | 15.22 | 0.40 | 0.76 | Smallcap | Banking & Finance, Realty, IT |
| JM ELSS Tax Saver Fund | 21.5 | 14.63 | 0.38 | 0.77 | Large & Smallcap | Banking & Finance, IT, Auto & Ancillaries |
Investing in ELSS funds can effectively help you achieve two goals: saving on taxes and potentially building wealth over time. For those under the old tax regime, ELSS investments allow for a deduction of up to ₹1.5 lakh under Section 80C. However, choosing the right ELSS fund involves looking beyond just AUM and considering the fund's investment strategy, risk profile, and historical performance. Happy investing!
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks. Read all the related documents carefully before investing.
Published on: Jul 15, 2025, 1:10 PM IST
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