A worthless security had a holding period of 6 months when it became worthless on December 10, 2018. The investor who had owned the security had a basis of $20,000 for it. Which of the following statements is correct?

The investor has a long-term capital loss of $20,000.

The investor has a short-term capital loss of $20,000.

The investor has a nondeductible loss of $20,000.

The investor has a short-term capital gain of $20,000.