17 Oct 2018, 12:00 — 1 min read
Definition: Capital gain is a rise in the value of a capital asset (investments in money/capital markets or real estate) that yields a higher value than the purchase price.
Example: If you bought a stock at $100 (p0 – price on day when you buy) and sold it at $150 (p1 – price on day when you sell), the capital gain will be calculated by [(p1-p0)/p0]x100. Using this formula will give you capital gain of your investment as 50%.
Business Insight: A Capital Gain is not realised until the asset is sold. Capital gains are often subject to taxation depending upon the statutory tax laws of different countries.
Posted byGlobalLinker Staff
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