Long Term Capital Gain Tax – a Blessing in Disguise
The Finance Minister, Mr. Arun Jaitley shocked the investor community when he re-introduced Long Term Capital Gain Tax in his Budget speech on 1 st February, 2018. Over the years, one of the major drivers for flows into equities was the tax free status of the gains after 1 year. However with the re-introduction of the taxation, that benefit will not be there from 1 st April, 2018. Though, it is a bitter truth for the equity investors, it can actually be a blessing in disguise for your personal finances. This has given a chance to all the investors to relook at their portfolio and rebalance the same towards optimal asset allocation. Equity mutual funds are generally held in the portfolio for long term. Thus, most of the times, the portfolio gets flooded with a number of schemes, where either the underlying stock portfolio is common leading to portfolio overlap, higher allocation towards a particular asset class, some non-performing scheme dilute the performance of bette...