ELSS Full Form - What does ELSS stand for?
ELSS stands for
Equity Linked Savings Scheme
Equity Linked Savings Scheme (ELSS) is a category of mutual fund that invests at least 80 percent of its assets in equity and equity-related instruments and qualifies for tax deduction under Section 80C of the Income-tax Act. It carries the shortest lock-in of any 80C option, three years from the date of each unit allotment, which makes it attractive compared with tax-saving fixed deposits of five years or the longer public provident fund. Investments up to the overall 80C limit reduce taxable income, and gains after the lock-in are treated as equity gains: long-term gains above the annual exemption are taxed at the applicable capital gains rate. Because the mandate is equity, ELSS funds carry market risk and are suited to goals at least five years away, where volatility can be ridden out. They are usually bought through SIPs, which spread the entry price across the lock-in period. Investors should treat ELSS as a long-term wealth-building fund first and a tax-saving instrument second, since the deduction is a benefit rather than the main reason to hold equity.
What does ELSS stand for?
ELSS is an abbreviation of Equity Linked Savings Scheme. Each letter in ELSS maps to a word in the phrase:
| Letter | Word |
|---|---|
| E | Equity |
| L | Linked |
| S | Savings |
| S | Scheme |
Where is ELSS used?
Investment abbreviations show up in contract notes, portfolio statements and market reports. Knowing what each term stands for makes it easier to track returns and risk.
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Frequently Asked Questions
What does ELSS stand for?+
ELSS stands for Equity Linked Savings Scheme.
What is ELSS?+
Equity Linked Savings Scheme (ELSS) is a category of mutual fund that invests at least 80 percent of its assets in equity and equity-related instruments and qualifies for tax deduction under Section 80C of the Income-tax Act. It carries the shortest lock-in of any 80C option, three years from the date of each unit allotment, which makes it attractive compared with tax-saving fixed deposits of five years or the longer public provident fund. Investments up to the overall 80C limit reduce taxable income, and gains after the lock-in are treated as equity gains: long-term gains above the annual exemption are taxed at the applicable capital gains rate. Because the mandate is equity, ELSS funds carry market risk and are suited to goals at least five years away, where volatility can be ridden out. They are usually bought through SIPs, which spread the entry price across the lock-in period. Investors should treat ELSS as a long-term wealth-building fund first and a tax-saving instrument second, since the deduction is a benefit rather than the main reason to hold equity.
What is ELSS used for?+
ELSS (Equity Linked Savings Scheme) belongs to the Investments & Markets category. Investment abbreviations show up in contract notes, portfolio statements and market reports. Knowing what each term stands for makes it easier to track returns and risk.
Which category does ELSS belong to?+
ELSS is filed under Investments & Markets, one of the 10 categories in our directory of 1538 full forms.