I started an SIP in an ELSS three years back and this three-year period came to end in March 2021. How will the redemption work? Also, I have a lump sum of Rs 1.5 lakh to invest in ELSS. Should I again spread it through an SIP or should I invest as a lump sum?
The lock-in period of three years will be counted for each of the 36 SIP instalments separately from their respective dates. So if you want to redeem this money, you will be able to withdraw the investment made in the first month only. The investments made in the subsequent months have not yet completed three years yet.
It would be better to average your purchase even if you have a lump sum to invest. You would save yourself from anxiety and reduce the risk of entering the market at the wrong level by averaging your purchase through an SIP.