Any profit or gain that arises from the sale of a ‘capital asset’ is a capital gain. This gain or profit comes under the category ‘income’, and hence taxable. The article looks at the reasons for this tax and the emotions that run through people at that time in the year.
Our emotional behavior clearly impacts our portfolios since it leads to actions such as buying, holding or selling our equity investments. Market volatility and emotional volatility go hand in hand. The goal and objective of equity investments is wealth creation over a long term and this will happen only if we control our emotion (panic/euphoria) enduring peaks and troughs of the sensex.
