While small case and mutual fund look similar to most investors it is important to understand that both operate quite differently, specially when you consider the taxation. So both smallcases and mutual funds are a mixture of various shares and indices. However when a smallcase manager buys and sells shares to maximise the returns of that particular smallcase, it reflects directly in your account - thus making you liable to pay capital gains tax However in case of mutual funds you do not have to pay any tax when the fund manager is buying and selling shares. Therefore it becomes important to consider the post tax returns while comparing these two investment options, specially since the last budget which has increased the short term capital gains tax to 20% #smallcase #mutualfund #budget #capitalgains