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Merits and Demerits of Equity Linked Saving Scheme

    IndianMoney.com Research Team | Wednesday, April 08,2009, 12:15 PM
 

Advantages of ELSS over NSC and PPF

  • Main advantage of ELSS is its short lock-in period. Maturity period of NSC is 6 years and PPF is 15 years.
  • Since it is an equity linked scheme earning potential is very high.
  • Investor can opt for dividend option and get some gains during the lock-in period
  • Investor can opt for Systematic Investment Plan
  • Some ELSS schemes also offer personal accident death cover insurance
  • Provides 30 to 40% returns compared to 8% in NSC and PPF

Disadvantages of ELSS

  • Risk factor is high compared to NSC and PPF
  • Premature withdrawal is not allowed but it is allowed in other instruments in some specific conditions

IndianMoney.com Research Team

The research team at IndianMoney.com comprises of certified and experienced professionals who share the company's vision to make every Indian financially literate by equipping every Indian with right and unbiased advice. IndianMoney.com research team provides newsletters, articles, videos and FAQs on various financial products and concepts only to help you make wise financial decisions.

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