Putting Mutual Fund Losses to Good Use

摘要

When mutual funds sell appreciated stock, the law requires them to dis- tribute their net capital gains to share-holders. Last year near this time, such payouts amounted to nearly 10% of the average equity fund's assets, the result of taking profits built up during the bull market. That rankled shareholders, who found themselves with huge tax liabilities even though their funds were falling in value. This year, most funds are swimming in losses, butrnthe law doesn't allow the funds to distribute them. Instead, they remain on the funds' books and can be used only to offset future gains.