A capital gain happens when an investor sells an asset for more than the initial purchase price to make a profit.
Most the time capital gains come from buying non consumable goods like stock or gold.
Capital gains have their own set of tax rules and there are things you should think about when it comes to buying stock.
Many times investors ask themselves should I sell the investments I own for a profit or should I wait and see if it goes up in value even more? Personally I think the answer to that question is quite simply "how well is the company that I own doing"? It's one of the things that investors don't look at enough investing in the stock market.
People will start investing in stocks or sell good stocks for just about every reason in the book except how well a company is actually doing.
Its amazing people will buy stocks because it feels good, because their friends told them too, because they have a hot tip, or maybe because they love to gamble and looks at charts all day; people however will not buy or sell stocks based on the value of the company and how well it's doing; just one of those things investors don't seem to want to address.
Just make sure that before you sell a stock even if it has gone up in value from the purchase price that you at least have reasonable cause to believe that the company won't be as powerful or continue to do as well as it has in the past.
Remember Warren Buffet has stated many times that if you truly own a good business that's making you profit why would you sell it?