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What is an arbitrage fund? How does it function in India?
Are there any tax implications in investing in an arbitrage fund in India?
Yes, there are tax implications when investing in an arbitrage fund in India. The gains made from these funds are taxable under short-term capital gains, which are taxed at the rate of 15%. However, if an investor holds the fund for more than a year, the gains are treated as long-term capital gains and taxed at 10% without indexation or 20% with indexation.