Realized Gain

Realized Gain refers to the profit that an investor earns when they sell an Asset for a price higher than its purchase price. This gain is “realized” at the point of sale, as opposed to “unrealized” gains, which occur when the value of an Asset increases but is not yet sold.

For example, if an investor buys 100 Shares of a Stock at $10 each, their total investment is $1,000. If they later sell those Shares for $15 each, they receive $1,500. The realized gain would be calculated as follows:

• Sale Price: $1,500
• Purchase Price: $1,000
• Realized Gain: $1,500 – $1,000 = $500

In another case, if an investor purchases a property for $200,000 and sells it later for $250,000, the realized gain would be:

• Sale Price: $250,000
• Purchase Price: $200,000
• Realized Gain: $250,000 – $200,000 = $50,000