Capital gains
GeneralThe profit you make when you sell an investment or property for more than you paid. In Canada, 50% of capital gains are added to your taxable income. Some capital gains may be exempt under Section 87 for Status Indians.
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Equity
The portion of an asset you actually own. For a home, equity is the market value minus the remaining mortgage. Equity grows as you pay down the loan or if the property value rises.
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Portfolio
The collection of all your investments — stocks, bonds, mutual funds, GICs, and other assets held together. Diversifying your portfolio across different types of investments reduces risk.
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Section 87
The section of the Indian Act that exempts the personal property of a Status Indian situated on a reserve from taxation. In practice, this can apply to employment income, investment income, and purchases — but only when specific conditions (the connecting factors test) are met. It does not mean all income is automatically tax-free.