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Finance Glossary

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Holding Period


The tax man is interested in how long you have your stocks and other securities before you trade because you get taxed differently depending on whether you keep 'em for a short term or hold onto 'em for a longer time.

The time you keep your stock before selling is known as the holding period. If you keep them for at least a year (and a day, weirdly) you get taxed a lot less. If you have them for less than a year, the money you make is treated like income and you pay a lot more. So you might want to show your stocks a little love and keep 'em around to cuddle for a while.