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Article:
Defining a Long-Term Investment in the Stock Market by: Charles M. O'Melia Defining a long-term investment in the stock market. For some 'long term'¯ would mean holding a stock position over the weekend. For others, it may mean holding a security for at least 1 year for the purpose of declaring a long-term capital gain, thus saving on taxes. The rigid definition of a long-term investment in the stock market would be holding a security for a minimum of 5 years, to as long as 30 years. I'm going to tell you my definition of a long-term investment in a security by telling you a story. A true story! My Mother worked as a teller in a small bank in Dover, New Jersey. The name of the bank was called The Dover Community Bank. While working at the bank (she eventually became a branch manager) she enrolled in the bank's dividend reinvestment plan, making purchases of the stock through pay-roll deductions from her paycheck. She continued purchasing the stock through the years, having the dividends from her shares in the bank reinvested into more shares every quarter. By the time she left the bank (in the early seventies) she had accumulated around 300 shares of The Dover Community Bank. My Father, when he retired, had the dividends from those shares sent home '“ to help ends meet. When my Dad passed away at age '80
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