2006-09-25 23:49:40 · 5 answers · asked by mangalpady 1 in Business & Finance ➔ Personal Finance
The name itself is tax benefit scheme it is better than investing dividend yielding securities. Dividends from indian companies are exempted but from Foreign company dividends ,co-operative societies dividends are not exempted. In this case it is better to invest in tax benefit schemes.
2006-09-26 00:05:11 · answer #1 · answered by Anonymous · 0⤊ 0⤋
I would suggest you to go in for Dividend Payout instead of Growth or Dividend Reinvestment Options. Let me explain in this way - Suppose you are investing Rs.1 lakh in a ELSS scheme under growth option, you will lock your money at least for 3 years. In between you are not getting any inflow of funds. Likewise, under Dividend Reinvestment Option, you will receive additional units in the same scheme. Whereas if you opt for Dividend Pay Out Option, you will receive money whenever the scheme declares any dividend. In this case, you will have an option to diversify your investible surplus and you can go in for another well performing one.
2006-09-26 06:44:59 · answer #2 · answered by BALU G 1 · 0⤊ 0⤋
Growth option is nothing but dividend reinvestment plan. Probably you mean choice between growth option or dividend option of ELSS scheme. I would suggest you should opt for dividend option which will provide more choices for investing the dividend than tying up with one fund.
Dividend being tax free, you have more avenues of investing the dividend received. The only loss is time between declaration of dividend, receipt and reinvestment.
2006-09-26 06:09:48 · answer #3 · answered by cvrk3 4 · 0⤊ 0⤋
Dear freind Investment in ELSS Growth option is one way better. If you invest in elss you have to wait for 3 years (lock in period).
As per IT rules if a dividend reinvestment made, again you have to wait for 3 years for your reinvested amount from the date of reivestment. you can withdraw your orginal amount after 3 years, but your dividend reinvested amount can't withdraw. this is only problem in dividend reinvestment otherwise it is very good option. It means your profits are converting in to no. of units. so in long run it will help to buildup wealth.
2006-09-27 02:16:33 · answer #4 · answered by kattamudi N V S S 1 · 0⤊ 0⤋
pls see Sr. No.3 at http://interesting-readings.blogspot.com/2006/09/tips-guide_24.html
2006-09-26 00:29:44 · answer #5 · answered by jsd 1 · 0⤊ 0⤋