Unrealized Gains and Losses Examples, Accounting
In other words, the pain of losing, say $100, is bigger than the pleasure received from finding $100. As they say, "losses loom larger than gains." In the context of investing, this is known as the disposition effect. As a result, people tend to hold on too long to losing stocks and sell their winners too early. Until an investment is disposed of, any change of value experienced is only unrealized, or "on paper." Only...
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