Investors who take a long position purchase shares intending to profit from their appreciation. This strategy is based on the belief that the stock’s price will increase, allowing the investor to sell the shares later at a higher price than the purchase price. Holding a long position typically indicates a bullish outlook on the stock and the overall market. Long positions can be held for various durations, from short-term trading to long-term investments, depending on the investor’s strategy.
Long Example
For example, if an investor buys 50 shares of a tech company at $100 each, their total investment is $5,000. If the stock price rises to $150 per share, the investor can sell their shares for $7,500, resulting in a profit of $2,500.