Sorry if this is a very novice question. I couldn't find it by searching here or Bogleheads (I'm not really a 100% Boglehead either).
Let's say I hold $30,000 in an ETF called BMT (Big Mike's Tech). And the breakdown of the BMT ETF is:
- 33% Oracle
- 33% Apple
- 33% Yelp
and 7 months down the road they sell Oracle for TIBCO. Yet I hold the ETF for 13 months. Do I pay the short-term capital gains on the Oracle for TIBCO change? Or do I just pay long-term capital gains on Big Mike's Tech ETF because I just exchanged that?
to sum it up quickly. If i buy 5 shares of an etf called BMT. no matter what BMT does with their money i only pay taxes when i sell my 5 shares of BMT (an etf, even if they turn over their assets everyday?)