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.