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Realized Gain

Categories: Tax, Stocks, Mutual Funds

The gain you make when you actually sell a stock or asset at a profit. You may own stocks for years and daydream about what you'd do when you sold it, but until it's sold those gains are unrealized.

Important note: You can't be taxed on unrealized gains, but you will fo' sho' be taxed on the realized ones.

And yes, you'll realize it.

Example

You bought GE at 10 bucks a share. You've held it a few years, and now it's at $30. Nice big fat hefty gain.

When you sell, you will "realize a gain" of $20 a share. 

Find other enlightening terms in Shmoop Finance Genius Bar(f)