New tax regime is here. Time to stop your ELSS investments?

ELSS (Equity-Linked Savings Scheme) funds, also known as tax-saving mutual funds, is having its Kodak moment. Just like the advent of digital photography was a kiss of death for Kodak's decades-old film-based business model, ELSS funds have been in the midst of a severe existential crisis due to the Indian government's tacit phasing away of the old tax regime. Sure, while Kodak's downfall was due its own handiwork of not moving with time, ELSS funds' shine has dulled due to external factors, namely New Delhi making the new tax regime to be a better option for a majority of Indian taxpayers. So, what do existing ELSS investors do, especially if they have completed their mandatory three-year lock-in period? Should they liquidate their investments and look for greener pastures? This is where cold, hard data can help you make a decision. How have ELSS funds performed in the past? Over any three‐year period (in the last decade), ELSS funds have delivered an average of 14.24 per cent returns per annum. The minimum three-year annualised return was -7.2