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An ELSS is a kind of Mutual Fund and is similar to any diversified equity mutual fund in many ways. An ELSS gives a tax benefit and comes with a lock in period of 3 years. Investment avenues of an ELSS are a mix of various asset classes such as equity, debt, gold and real estate.
Some advantages of ELSS are
* The 3 year lock in period prevents withdrawals and thus allows your money to grow over a period of time. Long term investment in equities gives better returns than any other investment instrument.
* It gives tax benefits (Up to 30% for people in the highest tax slab)
* Gives the flexibility to invest small amounts through a Systematic Investment Plan (SIP)
As an ELSS investor, your interests will be safeguarded by two separate market bodies. The Association of Mutual Funds in India (AMFI) and the Securities and Exchange Board of India (SEBI)
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