Gains on speculation in Stock Market

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Mahendra Naik (Querist)
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12 June 2009 Hi,

a) Can I have seperate portfolios for investment and trading, whereby gains on the investment portfolio will qualify as LTCG/STCG and those on the trading portfolio will qualify as income from speculation?

b) Suppose I have share A in my investment portfolio, I sell share A and buy it back on the same day. Can I show it as a speculative transaction not affecting my
investment portfolio i.e. FIFO not applying and simply an unrelated speculative transaction?

c) Is it to my discretion as to which transaction to classify as an investment and which to classify as speculative? If not what are the parameters on which IT dept categorises these?

Thanks & Regards

M Prabhakar Menon

M Prabhakar Menon (Expert)
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13 June 2009 For LTCG/STCG the period of holding the investment/securities is the criteria hence date of purchase and date of sale is important. This can be easily known without much effort from your broker's statement which is a part of your records.Your discretion does not arise.