Capital Gains Distribution
Mutual fund capital gains distributions typically occur near the end of the calendar year and are taxable to the fund's shareholders.
This poses a problem for some mutual fund investors who make initial purchases of mutual funds near the end of a calendar year. Because they receive a capital gains distribution, they immediately receive taxable income and face a mutual fund NAV that is reduced from the distribution.
Investment dictionary. Academic. 2012.
Look at other dictionaries:
capital gains distribution — A distribution to the shareholders of a mutual fund out of profits from selling stocks or bonds, that is subject to capital gains taxes for the shareholders. Bloomberg Financial Dictionary ( cash) Euroclear Clearing and Settlement glossary… … Financial and business terms
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capital gains distribution — (cash) Distribution of profits resulting from the sale of securities. Shareholders of mutual funds, unit trusts, or SICAVs are recipients of capital gain distributions, which are often re invested in additional shares of the fund … Euroclear glossary
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