InvestorQ : What are the different types of capital gains that arise from the sale of shares?
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What are the different types of capital gains that arise from the sale of shares?

Answer
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1 year ago


Long term capital gains (LTCG) arise when the shares are held for a period of more than 1 year (12 months).

Short term capital gains (STCG) arise when the shares are held for a period of less than 1 year (12 months)

Speculative gains are said to arise when the profits are booked on shares during the same day without intent to take delivery. A classic instance is intraday trading in stocks. Remember an important point. Capital gains only arise when you own an asset. In case of intraday trading, shares do not go into your demat account and hence there is no ownership. Hence this is strictly not capital gains and will be treated as other income. However, we are discussing only for the sake of completeness.