Hedging a long-term portfolio and tax

Hi guys,

What happens if I were to sell short index futures to protect against a fall in my long term investment shares?

Would any capital gains from the short position be taxable?

Quote:

---

Originally Posted by AMR

Hi guys,

What happens if I were to sell short index futures to protect against a fall in my long term investment shares?

Would any capital gains from the short position be taxable?

---

Good question, & the answer revolves around your timeframe, number of trades & ultimately intent.

Short selling is just another market deriative like, warrants & options

If you were doing this purely to hedge your long term investments, i'd say you're fine.

End of the day, when people start questioning if they are trading or not, they usually are, no point getting cute with the IRD, they dont have a sense of humour!