The duration of time that an investor owns an investment before selling or disposing of it. The holding period is the period between the initial purchase of the asset and its eventual sale. It is an essential factor in determining the tax treatment of any gains or losses realized from the investment. Short-term holding periods typically refer to assets held for one year or less, while long-term holding periods are those exceeding one year. Investors may adopt different holding periods based on their investment goals, risk tolerance, and market conditions.
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