1. What is Stock Profit & Loss Calculation?

The Stock Profit & Loss (P&L) calculation determines the financial gain or loss from an investment in stocks. It compares the current market value of shares against the original cost basis to show the unrealized profit or loss position.

2. How Does the Calculator Work?

The calculator uses the P&L formula:

Where:

• \( Current\ Price \) — Current market price per share ($)
• \( Shares \) — Number of shares owned
• \( Cost \) — Total original investment cost ($)

Explanation: The formula calculates the difference between the current market value of your investment and what you originally paid for it.

3. Importance of P&L Calculation

Details: Tracking investment performance is crucial for making informed decisions about holding, selling, or buying more shares. It helps investors understand their portfolio's performance and make tax-aware decisions.

4. Using the Calculator

Tips: Enter the current stock price in dollars, the number of shares you own, and the total cost of your original investment. All values must be non-negative numbers.

5. Frequently Asked Questions (FAQ)

Q1: Does this calculate realized or unrealized P&L?
A: This calculates unrealized P&L, which represents the paper gain or loss on your current holdings.

Q2: Should I include transaction fees in the cost?
A: Yes, for accurate calculation, include all transaction costs, commissions, and fees in your total cost basis.

Q3: What does a negative P&L value mean?
A: A negative value indicates a loss position - your investment is currently worth less than what you paid for it.

Q4: How often should I calculate my P&L?
A: This depends on your investment strategy. Day traders may calculate it continuously, while long-term investors might check weekly or monthly.

Q5: Does this account for stock splits or dividends?
A: No, this is a basic calculator. For splits, you would need to adjust your share count and cost basis accordingly.