Spain has a pretty bizarre taxation system when it comes to mutual funds. As long as the investment meets the criteria of “collective investment” (500 investors, and you can’t own more than 5% of the capital), you can switch between mutual funds to your hearts content without any capital gains taxes.
Feel nervous about the market? Switch to a money market fund, then switch to Asian equities, etc. As long as you don’t cash in your shares, you don’t have to pay any capital gains in Spain.
In addition, there’s no anti-deferral rules like in the US, so any increase in price due to interest, etc is treated just as a capital gain.
The one thing that isn’t clear is how automatically reinvested dividends are treated. European mutual funds generally don’t do yearly distributions of capital gains, interest, etc, so this doesn’t appear to be anticipated in the rules. From a lawyer I talked to, he thought that automatically reinvested dividends wouldn’t be taxed either. This is very similar to a scip dividend, which aren’t taxed in Spain either, so you have at least two arguments.
Of course, the US doesn’t look at it that way and taxes you as soon switch funds (unless they are shares of different classes in the same fund), so you might be able to do funky things in terms of timing your sales if you want to even out your US/Spain taxation.