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5.20How long are swing trades generally held?

1What is it?

Usually 2 days to 6 weeks.

2Why does it exist?

Long enough for a move to develop, short enough that business fundamentals don’t change much.

3Stock market example

Gains are taxed as STCG (20%) since the holding period is under 12 months.

4Quick revision
  • 2 days to ~6 weeks.
  • Taxed as short-term gains.
5Knowledge check
Q1. Are swing gains short- or long-term for tax?Show answer

Short-term (STCG).

Q2. Would a 6-month hold be swing or positional?Show answer

Positional.

Q3. Why not hold just one day?Show answer

That would be closer to intraday/BTST; swings need a few days to develop.

More in Level 5: Types of Stock Market Trading and Investing