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Consider diverting your SIPs from Sundaram Taxsaver to Canara Robeco Equity Tax Saver…

I am investing Rs 1,000 by SIP in Canara Robeco Equity Tax Saver and Sundaram Taxsaver funds. Kindly suggest if I should continue my investments or make any changes to my portfolio, considering the current market situation?
- Sridar S

Fund Scheme  Rating  3-yrs ret (%)  5-yrs ret (%)
Canara Robeco Equity Tax Saver ***** 20.87 18.23
Sundaram Taxsaver *** 7.75 11.67
Return as on September 07, 2011, Rating as on August, 2011

Tax planning funds have a three-year lock-in and one invests in these to benefit from the tax deductions that one can claim on these investments. Between the two funds Canara Robeco Equity Tax Saver is better and you should continue investing in it. You should consider exiting Sundaram Taxsaver and instead divert the SIP to Canara Robeco Equity Tax Saver. Remember, that each SIP instalment has to comply with the lock-in and hence invest in tax planning funds through SIPs keeping this fact in mind.

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