Definition of Holding Period

The time for which an investor holds on to a security is known as the holding period.

The period during which an investment is attributable to a particular investor is the holding period. In the long term it is the time period between the purchase and sale of a security.

Points to remember:

• A holding period helps to determine the taxing procedure of a capital gain or loss.
• A long term holding period is a period greater than one year.

Example:
If you sell a stock of RELIANCE is sold after a year then the time for which it is held in your demat account is known as holding period.