Top 10 ELSS funds: Save tax, make money

March 31 is round the corner. You must be scrambling to invest your money to save tax. And what else can be a better opportunity than putting your money in equity linked saving schemes or ELSS as they are popularly known.

They have attracted the attention of investors and tax-savers not only because they help us save tax but they also perform well to give decent returns in the long-term.

The markets may have been volatile in the last one month but ELSS schemes seem to have bettered the markets in terms of returns delivered to investors.

For while the 30-stock benchmark, the Sensex, has delivered a return of 28 per cent, the top 10 ELSS mutual funds have delivered a return of more than 26 per for the period between January 9, 2007 and February 8, 2008.

Taurus Libra Taxshield leads the pack for the period under consideration with a hefty return of 59.33 per cent.

• 10 stocks to make young investors crorepatis 

Simply put if you had invested Rs 10,000 on January 9, 2007 this amount would have increased to Rs 159.33 as on February 8, 2008. What's more your investment of Rs 10,000 (or as much as you had invested) would have been tax-exempt as well.

Going further down this list DSP ML Tax Saver Fund is the first runner-up notching a gain of 43.6 per cent and Lotus India Tax Plan follows with a gain of 38.1 per cent for the given period.

• Market crash: A quick guide for young investors

While seven funds in this list have outperformed the Sensex, three funds in this list, could not outperform the Sensex returns during the period under consideration.

These are Kotak Taxsaver (27.45 per cent), Sundaram BNP Paribas Tax Saver 98 (26.58 per cent) and Principal Personal Taxsaver (26.06 per cent).

The table below shows the top 10 ELSS funds:

Source: Rediff MoneyWiz