Contact Us

If you still have questions or prefer to get help directly from an agent, please submit a request.
We’ll get back to you as soon as possible.

Please fill out the contact form below and we will reply as soon as possible.

  • Courses
  • Find a Job
  • Home
  • Accounting, Taxation, and Reporting
  • Managerial & Financial Accounting & Reporting

Unrealized Gain - Explained

What is Unrealized Gain?

Written by Jason Gordon

Updated at April 7th, 2022

Contact Us

If you still have questions or prefer to get help directly from an agent, please submit a request.
We’ll get back to you as soon as possible.

Please fill out the contact form below and we will reply as soon as possible.

  • Marketing, Advertising, Sales & PR
    Principles of Marketing Sales Advertising Public Relations SEO, Social Media, Direct Marketing
  • Accounting, Taxation, and Reporting
    Managerial & Financial Accounting & Reporting Business Taxation
  • Professionalism & Career Development
  • Law, Transactions, & Risk Management
    Government, Legal System, Administrative Law, & Constitutional Law Legal Disputes - Civil & Criminal Law Agency Law HR, Employment, Labor, & Discrimination Business Entities, Corporate Governance & Ownership Business Transactions, Antitrust, & Securities Law Real Estate, Personal, & Intellectual Property Commercial Law: Contract, Payments, Security Interests, & Bankruptcy Consumer Protection Insurance & Risk Management Immigration Law Environmental Protection Law Inheritance, Estates, and Trusts
  • Business Management & Operations
    Operations, Project, & Supply Chain Management Strategy, Entrepreneurship, & Innovation Business Ethics & Social Responsibility Global Business, International Law & Relations Business Communications & Negotiation Management, Leadership, & Organizational Behavior
  • Economics, Finance, & Analytics
    Economic Analysis & Monetary Policy Research, Quantitative Analysis, & Decision Science Investments, Trading, and Financial Markets Banking, Lending, and Credit Industry Business Finance, Personal Finance, and Valuation Principles
  • Courses
+ More

Table of Contents

What is Unrealized Gain?How Does Unrealized Gain Work?Difference Between Unrealized Gain and Unrealized Loss

What is Unrealized Gain?

An unrealized gain is a type of profit that an investor, company, or individual is yet to receive but is expected to make in the future from the sale of an asset. Basically, it is the increase in value of an asset. Once assets are sold in exchange for cash for a profit, the gain becomes realized.

Back to: Accounting & Taxation

How Does Unrealized Gain Work?

There are diverse factors that could lead to the occurrence of an unrealized gain, in the case of an investment, when an investor holds the opinion that the investment would yield more gains later in the future, this is an unrealized gain. Holding onto an investment for a longer period of time with the expectation that its gains will increase is an instance unrealized gain.

Difference Between Unrealized Gain and Unrealized Loss

An unrealized loss is the direct opposite of an unrealized gain, an unrealized loss is a loss that exists on paper but has not been realized in real life. An unrealized loss can exist when an investor maintains a stock position for an investment which has accrued losses or retains a losing stock. In certain cases where an investor thinks he is holding onto an investment that could realize higher gains in the future, such a position can turn to an unrealized gain given certain market forces. For instance, a position can turn for the worse when there is price fluctuation that makes the market price of the security higher than the amount initially paid for the security by the investor.

unrealized gain

Was this article helpful?

Yes
No

Related Articles

  • Accounts Payable - Explained
  • Trial Balance - Explained
  • Working Ratio - Explained
  • Percentage of Completion Method - Explained



©2011-2023. The Business Professor, LLC.
  • Privacy

  • Questions

Definition by Author

0
0
Expand