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Finance Glossary

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Over 700 finance terms, Shmooped to perfection.

Long-Term Capital Gain

Definition:

Long-term capital gain is a type of tax on an investment that you've held onto for a year and a day (at least).

Long-term gains are usually taxed less than short-term gains; the goal is to encourage investors to be more patient and to hold their investments longer; the broader gain being, in theory, a more stable stock market.

See also short-term capital gain.