Given the equity component in MIPs, you cannot be sure that last year's return will be repeated this year

There are three clarifications here. One, given the equity component in MIPs, you cannot be sure that last year's return will be repeated this year. Even if the stock market performs in the same manner in 2015 as in 2014, the stocks held in the portfolio may deliver different returns. Two, the return is calculated on the basis of the change in the NAV of the fund between two different dates. For instance, IDFC MIP Regular Plan's NAV was R15.63 as on 31st October 2014 and R13.35 as on 31st October 2013. This resulted in a return of 17.04 per cent as on October 31 2014. A fund is always bought and sold at the prevailing NAV and the gains or losses are determined on the basis of the NAV from the date of purchase for the investor.

Three, the returns of 17 per cent on the scheme do not equate to your annual or monthly income. The return shows that the securities held by the fund appreciated by 17 per cent (after expenses) in the last one year. Out of this gain, the fund may choose to distribute only a part as dividends. Therefore, though the scheme's returns were R17000 for the year, the dividends received by investors could be much lower.

1.ICICI Prudential Tax Plan

2.Reliance Tax Saver (ELSS) Fund

3.HDFC TaxSaver

4.DSP BlackRock Tax Saver Fund

5.Religare Tax Plan

6.Franklin India TaxShield

7.Canara Robeco Equity Tax Saver

8.IDFC Tax Advantage (ELSS) Fund

9.Axis Tax Saver Fund

10.BNP Paribas Long Term Equity Fund

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