Capital Gain refers to the profit made from selling a stock or other investment at a higher price than what was originally paid for it. It is calculated by subtracting the purchase price (also known as the cost basis) from the selling price. Capital gains can be realized when an investor sells a stock for a higher price than they bought it for, resulting in a positive return on their investment. It’s important to note that capital gains are typically subject to taxes, with the rate depending on how long the investment was held before being sold.