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portfolio turnover
portfolio turnover definition - finance
The
frequency with which stocks and other investments are bought and sold within a
portfolio. A high turnover ratio isnÂ’t usually positive, as it means that the
portfolio manager spends a large amount of money on trading commissions. High
turnover also likely means that the gains are taxed as ordinary income rather
than at the long-term capital gains rate, which is lower. A mutual fundÂ’s
portfolio turnover ratio is disclosed in its prospectus.
Webster's New World Finance and Investment Dictionary Copyright © 2003 by Wiley Publishing, Inc., Indianapolis, Indiana.
Used by arrangement with John Wiley & Sons, Inc.
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