What Is Floating Loss and Floating Profit?

Floating loss and floating profit are terms used in financial trading to describe the unrealized, or paper, gains or losses on open positions.

Floating loss refers to the negative difference between the current market price of an asset and the price at which it was purchased or entered into a trade. It represents a loss that has not been realized because the position is still open.

Floating profit, on the other hand, refers to the positive difference between the current market price of an asset and the purchase price. It represents a profit that has not been realized because the position is still open.

These terms are commonly used in trading to assess the potential gains or losses of open positions and to determine the overall profitability of a trading portfolio. Floating losses and profits can change as market prices fluctuate, and they become realized gains or losses when the positions are closed.