Real estate and gold have traditionally formed a large chunk of Indian investors' portfolios. However, over the past few years, returns from real estate have been poor to negative. On the other hand, gold does not give attractive returns in the long term and has high transaction cost.

Apart from keeping gold or real estate for self-use, investments in these two asset classes doesn’t make much financial sense. But if you choose to reduce exposure to gold and real estate, do pay attention to the tax rules that will apply. Here is a look at the taxes that apply to short-term and long-term gains from these two asset classes.