Definition: The money gained when a stock appreciates (goes up). For example, if you owned 10 shares of stock that you paid $15 for and it went up to $30, you would have $150 in capital gains.
TeenAnalyst Advice: Capital gains are where you'll make the majority of your money if you invest in common stock. Some people think you make most of your money from dividend.html">dividends. That's wrong.
It's also important to realize that you'll have to pay taxes on the capital gains you receive. This is called a capital gains tax. However, if you hold the stock for a while, you might qualify to pay a reduced capital gains tax called the "long-term capital gains tax." It's yet another benefit of buy and hold investing!