An unrealized loss is the amount of money you would lose if you sold a given asset.
An unrealized loss -- also called a paper loss -- is a loss only in theory, since it is the amount of money you would lose relative to your cost basis if you sold a given asset. Unrealized losses are recorded on quarterly investment statements and contribute to net worth, but they are not counted in your tax bill.
When the asset is sold, the loss becomes realized.
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