Coming to terms: long-term investing

Q: I've heard that you should invest in stocks for the long term. Just how long is that? A: For tax purposes, you should aim to hang on...

Q: I've heard that you should invest in stocks for the long term. Just how long is that?

A: For tax purposes, you should aim to hang on for at least a year and a day, so that any gains qualify for the long-term capital-gains rate, which is currently 15 percent for most of us. (Short-term gains, from holdings of one year or less, are taxed at your ordinary income rate.)

In general, most investment professionals say you should aim to hold on for at least several years, if not many years — as long as the company remains healthy and growing, and as long as its stock hasn't gotten way ahead of itself. Many fortunes have been built by people who invested in various companies for decades.

The Motley Fool

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