I have some money to invest now (Oct 2012). I have read that it is not a good idea to invest in Mutual Funds during the year-end due to capital gains distributions related tax implications. Does the same apply to ETFs also?
EFTs can distribution capital gains and dividends. Especially if the EFT or Mutual Fund only distributes dividends and capital gains once a year, then buying late in the year can have significant tax consequences.Rather than saying you should never invest in Mutual Funds or EFTs at year-end, check the ex-dividend dates and history of the specific EFT or Mutual Fund. Also, if the EFT or Mutual Fund is held in a retirement account, the timing of dividends and capital gain distributions have very limited tax consequences.
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