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Jerry wrote:
<< Short term trading generates income which is taxed at ordinary income
rates.
When you factor in state taxes, the tax bite can be well in excess of 40%.
With short term trading, if you are successful, you are pretty much taxed on
an annual basis. If you are wrong, there are limits on using the losses for
tax purposes.
Long term investors are accumulaters of wealth. The maximum tax rate is 20%
(Federal) and this tax is not paid until the sale of the asset. It has been
my experience that long term investors accumulate wealth faster than traders.
Now there are exceptions to every rule and sometimes trading wins. >>
All profits/losses from futures trading, whether day trading or holding a
position for a year or longer, are taxed at 60% long term capital gains, and
40% short term capital gains. (Refer tofederal tax form 6781.)
Jim
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