Traditional test used by the courts to distinguish between securities transactions on income account and those on capital account:
The elements of the traditional test include:
(a) frequency of transactions;
(b) period of ownership;
(c) knowledge of securities markets;
(d) security transactions forming part of the taxpayer’s ordinary business;
(e) time spent researching securities markets and potential purchases;
(f) the extent to which debt financing is used;
(g) advertising; and
(h) in the case of shares, whether they are speculative in nature or dividend-paying.
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