AppliedMultiple choice
Why do equity ETFs usually distribute fewer capital gains to holders than comparable mutual funds?
- AETFs are exempt from capital gains tax under the rules that govern exchange-listed funds
- BETFs never sell any of their holdings, so they never realise a gain of any kind
- CRedemptions are in kind, so low-basis lots leave without a sale
- DETF holders pay tax daily on price changes, so nothing accumulates to distribute
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