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IIFL mutual fund launches ‘India’s first Tax Saver Index Fund’, NFO opens today

The dedicated Fund Manager for the IIFL ELSS Nifty 50 Tax Saver Index Fund is Parijat Garg.Premium
The dedicated Fund Manager for the IIFL ELSS Nifty 50 Tax Saver Index Fund is Parijat Garg.

  • The first Tax Saver Index Fund in India, the IIFL ELSS Nifty 50 Tax Saver Index Fund, will be on sale through a new fund offer (NFO) that begins on December 1 and ends on December 21, according to IIFL Mutual Fund.

The first Tax Saver Index Fund in India, the "IIFL ELSS Nifty 50 Tax Saver Index Fund," will be on sale through a new fund offer (NFO) that begins on December 1 and ends on December 21, according to IIFL Mutual Fund. Beginning on January 2, 2023, subscriptions and redemptions will once again be accepted continuously. The dedicated Fund Manager for the IIFL ELSS Nifty 50 Tax Saver Index Fund is Parijat Garg. As an open-ended passive equity-linked savings scheme that replicates or tracks the Nifty 50 index and has a statutory lock-in period of three years and the fund will provide both a tax benefit and create wealth.

Given that it is an index fund, its goal is to have a portfolio that closely resembles the Nifty 50 Index, which is made up of large-cap Indian firms. Comparing this passive fund to actively managed investments, which typically have higher expense ratios, this one is reasonably inexpensive.

Commenting on the NFO, Parijat Garg, Fund Manager, IIFL AMC, said, “The Nifty 50 accounts for about 50%2 of India’s market cap. Taking exposure to the Nifty companies through a passive fund is an opportunity for investors to harness the growth potential of equities, reduce tax outgo, lower the cost of investing, and gain diversified exposure."

“An offering of this kind was long awaited by the market. Time and again, the Indian equity market has demonstrated formidable resilience against both domestic as well as global headwinds. For investors, one of the ways to leverage the India growth opportunity would be a passive investment with tax-saving benefits. Due to its passive approach, the fund eliminates the selection and behavioral biases that impact investment decision-making," Parijat added.

IIFL Mutual Fund said while launching that the investment objective of IIFL ELSS Nifty 50 Tax Saver Index Fund is to invest in stocks comprising the Nifty 50 Index in the same proportion as in the index to achieve returns equivalent to the Total Returns Index of Nifty 50 Index (subject to tracking error), while offering deduction on such investment made in the scheme under section 80C of the Income-tax Act, 1961. It also seeks to distribute income periodically depending on distributable surplus. There is no assurance or guarantee that the investment objective of the Scheme would be achieved. Investments in this scheme would be subject to a statutory lock-in of 3 years from the date of allotment to avail Section 80C benefits.

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