This tax saving mutual fund scheme will give dividends today: Do you own the schemes?

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DSP Mutual Fund has declared dividends in its ELSS Tax Saver Fund. Investors will receive a dividend of ₹0.580 per unit, with the record date set as May 16, 2024.

The fund house has declared dividends in both its DSP ELSS Tax Saver-IDCW and DSP ELSS Tax Saver Direct-IDCW schemes.

DSP ELSS Tax Saver Fund is mandated to invest at least 80% of its assets in equity stocks.

It offers tax exemption under Section 80C of the Indian income tax laws.

As per this section, investments of up to ₹1.5 lakh in a financial year in eligible securities are exempt from tax.

According to Value Research, the net asset value (NAV) of the DSP ELSS Tax Saver Fund is ₹118.2560 as of May 16.

It is 17 years and 4 months old. It has delivered 15.32% returns since inception.

Understanding mutual fund dividends

Mutual fund dividends are distributions of profits made by mutual funds to their investors.

These distributions can occur regularly or periodically, depending on the fund’s performance and the decision of the fund manager.

Mutual funds typically generate income from various sources such as dividends from stocks, interest from bonds, and capital gains from the sale of securities.

Who can get mutual fund dividends?

Any investor who owns units or shares in a mutual fund on the record date is eligible to receive dividends.

However, it’s essential to note that not all mutual funds pay dividends.

Some funds may choose to reinvest profits back into the fund rather than distributing them to investors.

How do mutual fund dividends work?

When a mutual fund declares a dividend, it specifies the amount to be paid per unit or share.

This amount is usually expressed in terms of rupees or a percentage of the fund’s net asset value (NAV).

The NAV is the per-unit market value of the fund’s assets minus its liabilities, calculated at the end of each trading day.

On the record date, the mutual fund determines which investors are eligible to receive the dividend based on their holdings on that date.

Investors who own units on the record date will receive the dividend payout in their bank accounts or through other specified modes of payment.