Have you invested in a Mutual Fund? If yes, you are already aware of the numerous benefits of investing in a mutual fund. If no, it is about time to make the most of this excellent investment option. Mutual funds are easy to understand tools which can help you maximize your capital over a period of time. The highest lock-in period of mutual funds is way less than what you get with other investment modes.
It is easy to get in and out of a mutual fund as well. You can invest whenever you wish or set up regular installments, where a predefined amount will be deducted from your account. There are various types of mutual funds which are designed to help you achieve different financial goals. If you are looking from a mid-term or long-term time frame, ELSS can be a great way to invest. Axis Long Term Equity fund is an ELSS fund.
This fund from Axis Mutual Fund has multiples benefits. Of course, it will help your capital appreciate over time. Apart from that, you can also use these investments for tax saving purposes. All the investment made under Axis Long Term Equity fund will provide you with tax benefits under Section 80C. The fund is diverse in nature which helps reduce the risk associated, without giving away much on the returns part.
Here are some of the most prominent features and benefits of investing in Axis Long Term Equity fund.
Axis Long Term Equity fund has quite a few objectives up its sleeves. Being a mutual fund at the core, its primary objective is to offer capital appreciation for its investors or subscribers. Apart from that, it can also act as a source of income, should you opt for the dividend option. The fund uses a diverse investment mode to invest in equity and equity based investment instruments.
The fund manager looks for companies with strong, robust and sustainable growth plans. The fund is flexible and invests in companies from different market capitalizations. A good mix of all the three market caps ensures growth and stability. As is the case with any other mutual fund, irrespective of all the precautions, no one can assure that the fund objectives will be met.
If you wish to invest in Axis Long Term Equity fund, the following are the options and plans that you can choose from.
The growth option is one of the most commonly opted ones when it comes to mutual funds. As and when there are any gains from a mutual fund, the same is reinvested into the fund. This allows your capital to view and benefit from the power of compounding. You do not receive any returns unless you redeem units. There are no intermediate dividends or bonuses.
A direct option is a mutual fund that you can directly buy from Axis Mutual Fund AMC. When you opt to buy from distributors, advisors or brokers, you end up paying slightly higher charges in the form of expense ratio. The expense ratio in a direct plan is relatively lower, making way for better or higher returns.
You can opt for dividend option if you wish to receive funds at regular intervals. If your fund makes enough gains, it is at the discretion of the fund manager to pass on the benefits to you in the form of dividends. It must be noted that there aren’t any hard and fast rules for paying dividends.
Axis Long Term Equity fund is an open ended mutual fund. This means that there aren’t a limited number of units and that one can buy as many units as they wish. It also comes under the category of ELSS or Equity Linked Saving Scheme. One could argue that there are several other modes of investment as well such as Fixed Deposit, PPF and NSC. They provide tax benefits as well. However, the returns from these investments are taxable, which is not the case with ELSS.
The returns that you can get with your Axis Long Term Equity fund are relatively higher and taxable partially. For all investments made prior to 31st of January 2018, the gains or proceeds are non-taxable. However, for investments post that, if the gains exceed INR 1,00,000 you will end up paying taxes of 10% on the additional amount.
A mutual fund, in general, is subject to market risks. The risk factor is further accentuated, if the fund belongs to the equity category. Any changes in the capital market directly impact the fund’s NAVs and in turn your portfolio. If as an investor, you are willing to take a moderately high risk, Axis Long Term Fund might be the one to look for.
Factors such as the trading volume of individual stocks, liquidity risk, settlement risk and the risk of losing your capital are some of the major risks that one might have to deal with. If the fund invests in any securities that are not listed on the stock exchanges, there are fundamental risks associated with it. The non-availability of a lot of buyers and sellers can hamper your holdings. In the event that a considerable number of investors wish to redeem their units, it might create some risks. Should there be enough cash at hands, the fund manager can handle the situations or in the extreme cases, they will have to sell some of the assets to make way for redemption. In such cases, the fund manager must rebalance the units accordingly.
A lot of investors take a keen interest in knowing the holdings of a mutual fund. For the ones who take a closer look at the capital market, being aware of these holdings can make decision making process that much easier. Here are the top 10 holdings of Axis Long Term Equity Fund.
| Holding | Percentage Allocation |
|---|---|
| Tata Consultancy Service Limited | 9.92 |
| HDFC Bank Limited | 9.26 |
| Kotak Mahindra Bank Limited | 6.91 |
| Pidilite Industries Limited | 5.96 |
| Housing Development Finance Corporation Limited | 5.23 |
| Bajaj Finance Limited | 4.99 |
| Gruh Finance Limited | 4.52 |
| Maruti Suzuki India Limited | 4.38 |
| Sun Pharmaceutical Industries Limited | 4.02 |
| Bandhan Bank Limited | 3.83 |
Here are the top 5 sectors in which the fund invests heavily along with its distribution pattern.
| Sector | Percentage Allocation |
|---|---|
| Banking | 20.0 |
| Finance | 18.74 |
| IT Software | 12.48 |
| Automobile | 7.22 |
| Auto Ancillaries | 7.22 |
Past performance of a Mutual Fund is a great way to get insights into how the fund has behaved over time. Some people might even use this data to zero down on the fund. However, it must be noted that past performance does not necessarily guarantee future returns. While one can use these as reference points, this should not be your sole criteria.
Asset Under Management INR 16,998.90 CR
| 1 Year Returns | 3 Year Returns | 5 Year Returns | |
| Regular Fund | 8.04% | 10.95% | 23.23% |
| S & P BSE 200 | 9.54% | 12.85% | 16.76% |
| Date | NAV Per Unit (Cumulative) | NAV Per Unit (Ex Dividend) |
| March 2018 | 23.05 | 20.55 |
| January 2017 | 21.17 | 18.94 |
| January 2016 | 21.22 | 18.97 |
| January 2015 | 24.29 | 22.29 |
Once you are convinced that Axis Long Term Equity fund is for you, investing in the fund is the next logical step. One of the core strengths of a mutual fund is the level of convenience that it brings on to the table and it is no different when it comes to applying as well. You can either opt for the online mode or the offline mode.
Depending on whether you wish to buy a direct fund or a regular fund, you can choose the platform. For a direct fund, you will have to buy the fund from Axis Mutual Fund’s website. For a regular fund, you can visit any broker or distributor or advisor’s website and proceed with the same. The first step for buying any mutual fund is to get your KYC done.
If you have already registered for KYC, you can directly search for the fund and invest the amount you wish to. While buying, you can proceed with a lumpsum deposit or set up an SIP or systematic investment plan. And if you haven’t registered KYC, you would need to fill up a form and provide supporting documents for the same. The process remains the same once your KYC is approved.
Investors who aren’t big fans of online transactions can still choose to invest offline. You would need to get in touch with a representative from Axis Mutual fund or walk into a local branch. A new investor would need to get their KYC registered. For which, one would have to fill up a form and provide supporting documents. Along with the documents, you would need to write a cheque for the investment. You can also set up for an SIP during this time.
How do I buy Axis Long Term Equity Fund plan online?
To buy the mutual fund online, you can either visit Axis Mutual Funds website directly or visit a broker/distributor/advisor. The first step towards mutual fund investment is getting your KYC done. Once you are KYC registered, you can start investing in the mutual fund.
How do I contact Axis Long Term Equity Fund Company?
You can call Axis Mutual Fund at 1800 221 322 / 1800 3000 3300. You can also send in your queries directly to customerservice@axismf.com. Alternatively, you can walk into a local branch and get your queries resolved.
Can I redeem ELSS before 3 years?
No. The lock-in period for an ELSS is 3 years. Thus, you cannot redeem any units prior to the completion of three years.
