Should I stop SIP in DSP BlackRock Tax Saver Fund?

I have invested in three ELSS funds via SIPs to save taxes: Rs 4,000 per month in ABSL Tax Relief 96 Fund, Rs 3,000 per month in Axis Tax Saver Fund, and Rs 3,000 per month (Rs 1,000 top-up per year) in DSP BlackRock Tax Saver Fund. Compared to the other two schemes, DSP BlackRock Tax Saver is not performing well in the last eight to 10 months. Should I stop the SIP in DSP BlackRock and switch to IDFC Tax Advantage (ELSS) Fund? Or should I continue with it, as DSP BlackRock Tax Saver was one of the top rated funds till 2017.
-- Santosh Kumar

Rishabh Parakh, founder, Money Plant Consultancy, responds:

ELSSs by default are diversified and works as a multicap fund. So investing for tax saving under section 80C in ELSS is one of the best investment option. But diversifying the monthly SIPs into multiple ELSS funds may not be a great idea because ultimately ELSS category is already diversified. Doing further diversification will not create a huge difference in the returns.

Also, none of the mutual funds schemes can be at the top for a long time. The ratings and performance change due to many economical factors. Though it is very important for you to monitor your portfolio regularly, it is not prudent to shuffle your funds very frequently.


All the schemes you have mentioned have given an annualised return of approximately 20 per cent over five years and around 11-12 per cent over 10 years (except Axis Tax Saver Fund and IDFC Tax Advantage (ELSS) Fund which have not completed 10 years). The returns form SIPs and overall market has been stagnant for the past six months. But equity mutual funds are for long-term investments and you should always invest in them for 5 to 10 years to create wealth. I would ask you to stick to these schemes for some more time. If the performance of DSP BlackRock Tax Saver doesn’t improve and all the other funds keeps on performing, you can change your investment strategy and the scheme.