Tata Mutual unveils tax saving fund
Business Standard — January 25, 2006

The Tata Mutual Fund on Tuesday unveiled an equity-linked savings scheme, Tata Tax Advantage Fund-1.

The 10-year close-ended scheme will invest its corpus mainly in equity and equity-related instruments and 0-20 per cent in debt and money market.

It will offer tax benefits under Section 80-C of the Income Tax Act, 1961. The lock-in period under the scheme is three years.

The scheme will close for subscription on February 20, after which, no fresh investments will be accepted. The close-ended nature of the scheme, enables fund managers to take long-term bets in the equity market.

Ved Prakash Chaturvedi, managing director, Tata Mutual Fund, said, "The close-ended nature provides fund managers the opportunity to invest in fundamentally strong stocks that are likely to create long-term value. The ability to create a stable portfolio with lower turnover could result in lower transaction costs for investors."

Minimum investment under the scheme is Rs 500. The scheme will charge 2 per cent entry load. There will be no exit load.

The benchmark index for the scheme is Bombay Stock Exchange's Sensex.