Legal Dictionary of Pakistan
Quick lookup for English, Urdu, and Latin legal terms used in Pakistani jurisprudence.
Straddle
n. In securities and commodities trading, a situation in which an investor holds contracts to buy and to sell the same security or commodity, thus ensuring a loss on one of the contracts. ( The aim of this strategy is to defer gains and use losses to offset other taxable income. - Also termed spread eagle; combination. - straddle, vb.
tax-straddle rule
The rule that a taxpayer may not defer a tax liability by investing a short-term capital gain in a commodities future or option (i.e., investment vehicles whose values formerly did not have to be reported at the end of the year) to create the appearance of a loss in the current tax year. ( This practice has been greatly restricted by the requirement that gains and losses on commodities transactions must be reported based on their value at year end. IRC (26 USCA) ยง 165(c)(2).