RGESS eligible mutual funds (NFO) which are open now
Market is flooded with Rajiv Gandhi Equity Saving Scheme (RGESS) eligible mutual funds. Under Rajiv Gandhi Equity Saving Scheme, a new investor can participate by investment in equity markets and get tax exemption of Rs 50,000 under Section 80CCG. This is over and above Rs 1 lakh eligible tax deduction under 80C. Last year, Govt has indicated that only direct investment in stock markets for new investors are eligible for tax deduction of Rs 50,000. After several deliberations they have made guidelines where mutual funds can participate in RGESS scheme.
Currently there are two RGESS eligible mutual funds (F) which are open now for investments.
HDFC RGESS Series-1 mutual fund scheme
HDFC RGESS series-1 mutual fund scheme NFO closes on 15-Mar-13. The objective of this mutual fund is to invest in long term capital appreciation in eligible securities as specified in Rajiv Gandhi Equity Saving Scheme. This is an ELSS saving scheme which is open ended. Minimum investment under this scheme is Rs 500.
Birla Sunlife RGESS – Series-1 mutual fund scheme
Birla Sunlife RGESS series-1 mutual fund scheme NFO closes on 20-Mar-13. The objective of this mutual fund is to invest in eligible securities as specified in Rajiv Gandhi Equity Saving Scheme. This is an ELSS saving scheme which is close ended. The scheme would be for 3 years. Minimum investment under this scheme is Rs 5000.
Conclusion: Investment in Mutual funds carries less risk comparing to direct stock investment. For a new investor, investments in such RGESS eligible mutual funds would be a good opportunity for investment in stock markets. Since these mutual fund schemes are new fund offers, it would be difficult to predict the future performance of such mutual funds. Nevertheless, it is a good opportunity for new investors.
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RGESS eligible mutual funds (NFO)