Unrealized gain/loss

What is an unrealized gain/loss

An unrealized gain or unrealized loss is the difference between the current market value of an asset and its purchase price, as long as you still own the asset and the trade has not yet been closed. This state is "unrealized" because an actual gain or loss only occurs at the moment of sale.

How unrealized gain/loss works

• If the market price of the asset rises above the purchase price, an unrealized gain arises.
• If the market price falls below the purchase price, an unrealized loss arises.
• The value changes in real time based on market price movements.

Importance for the investor

• Allows you to track the current state of your portfolio.
• Helps decide when to realize a gain or minimize a loss.
• In most jurisdictions it does not directly affect taxes until the sale takes place.

Unrealized gain/loss and investment strategy

Investors often use unrealized values to:

• evaluate performance within portfolio management,
• set stop-loss and take-profit order levels,
• monitor the impact of market volatility on their wealth.

Unrealized gain/loss on Stonkee

On Stonkee you can track the unrealized gain and loss on all assets you hold. The system automatically calculates the difference between the current price and the purchase price and provides visualizations for a clearer view of your portfolio's status.

Summary

Unrealized gain/loss is a metric that helps investors understand how current market movements are affecting the value of their investments, even though the trade has not yet been closed.