Hello
I have a question. I am not sure if this is the right forum, if not, kindly guide me about where I could get it answered.
I just wanted to understand the portfolio turnover ratio. I see that most equity funds have portfolio ratio well in excess of 50%. Does it mean the sell and buy half of their portfolio every year.
Would that not lead to huge short term capital gains tax on the mutual fund in case the stocks did well. If that is the case, would it not reduce the returns the investor might get?
Also, if stocks are not doing well, you would expect the fund manager to have atleast some conviction in their picks.
Thanks