Unrealized gains refer to profits from the increase in stock price over the price you paid for stock you still own. The gains are unrealized because your bank account isn't any bigger -- yet. You won't realize the gain until you sell the stock, and the price could change before then. Unrealized gains do not take into account any taxes you will owe when you do cash out or any transaction fees to sell the stock. When you sell the stock, you will have to pay taxes on the realized gains.
Step 1
Multiply the price you paid per share by the number of shares purchased to calculate your cost for the stock. For example, if you bought 100 shares at $18 per share, your cost is $1,800.
Step 2
Multiply the current price by the number of shares you own to figure the current value of the stock. Continuing the example, if the stock is now worth $20 per share, multiply $20 by 100 shares to get $2,000.
Step 3
Subtract your cost from the current value to figure your unrealized gain. In this example, subtract your cost of $1,800 from the current value of $2,000 to find your unrealized gain is $200.
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Writer Bio
Mark Kennan is a writer based in the Kansas City area, specializing in personal finance and business topics. He has been writing since 2009 and has been published by "Quicken," "TurboTax," and "The Motley Fool."