Basics Beginner: Capital Gains

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1.
The amount of time you hold onto an asset is known as the ________.
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Holding period. The holding period is the amount of time you hold onto your asset.
2.
The difference between the original price of an asset and the price you sell it for is known as its _______.
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Realized capital gain or loss. The realized gain or loss is the difference between the price at the time you sell it and the original price you paid for it.
3.
Long-term capital gains are taxed at a higher rate than short-term capital gains.
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False. Long-term gains are taxed at a lower rate than short-term gains.
4.
Long-term capital gains are taxed at higher rates than short-term capital gains.
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False. Long-term gains are taxed at lower rates than short-term gains. This is meant to encourage investors to invest for longer periods.
5.
Almost _______ of all realized capital gains are received from corporate stock sales.
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50 percent. Almost half of all capital gains taxes are taxes on corporate stocks.