Securities Training Series 7 Practice Test 2025 - Free Series 7 Exam Practice Questions and Study Guide.

Position trading is primarily characterized by the long-term holding of inventory. This strategy involves traders or investors taking positions in securities with the expectation that they will appreciate over a longer time frame, which can range from several weeks to years. Unlike short-term strategies that focus on quick price movements and frequent trades, position trading emphasizes a more patient approach, allowing positions to develop over time.

The logic behind this strategy is based on fundamental analysis, where traders believe in the underlying value of the security and are less affected by short-term market fluctuations. This contrasts with other trading styles that may involve shorter holding periods or frequent buying and selling of assets. As a result, position traders tend to minimize transaction costs and can focus on broader market trends and patterns rather than short-term volatility.