What is the difference between realized and unrealized profit and loss in Zerodha Console? Is it mandatory to get this statement each time?

Can someone explain what is realized and unrealized P&L in the Zerodha console? If I do day trading then how frequently I have to check it. Also, how do I interpret it?
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Short Answer

Realized P&L statement is the total amount of profit or loss you have made with each trade in any segment is reported here. It also includes the brokerage charge that you might have to pay.

An unrealized P&L statement involves the active trades currently running under your portfolio, which showcases how much profit or loss you are currently making in those trades.

Detailed Answer

Zerodha happens to be one of the biggest stockbrokers in the country, offering surplus features and a simple trading experience. It’s for good reasons that the stockbroker has undoubtedly amassed millions of active users over a very short period. However, you might need some time to understand the applications and use them if you’re a beginner.

But when it comes to the basics, then it’s quite straightforward and simple. Normally, you would enter a trade when the prices might be lower and sell it when the prices might be higher. That the typical way, any trade is executed. However, while using Zerodha, you might have noticed that your profits are divided into two spectrums. One is unrealized, and another is realized P&L statement. Now to understand what it is, we have illustrated it in detail below.

P&L statement

P&L statements are part of the Zerodha console’s feature, where one can easily figure out the number of trades executed over time and the profit or loss made during each day. It’s a quiet and intuitive feature considering that you can track your trades and even see the intensity of profits or loss made. P&L statement stands for the profits and loss statement made for any particular day, week or month, and even year. Therefore, it isn’t segregated into different segments, but all the trades (irrespective of segments) is listed here and denoted in green or red based on profit and loss.

Realized P&L

Realized P&L statements is the amount of profit or loss that has been booked. It gives a representation of the profit or loss you made in a trade after closing it. These are trades executed in different segments of the stock markets. However, the realized P&L statements is often projected without the brokerage charges. Therefore, once the brokerage changes are included based on the type of trade and the number of trade, the net realized P&L statement might vary.

Unrealized P&L

Unrealized P&L statements are a statement in which users can notice the active trades or running holdings. Its where all the segments that the investor might have invested in notice their trades and can witness the average trade volume, highest/lowest share prices, and so on. It’s a sheet giving real-time profit and loss that your trades are making. Most often, these showcase the P&L statement without brokerage charges. A detailed overview of this can be found in your portfolio or holdings section. If you want the broker that you might incur for unrealized P&L when you realize them, that should be displayed under your Zerodha console section.

When the trade is squared off, realized profit is computed. In this, all the intraday trades and F&O positions are considered. CNC trade has no impact on the realized profit of a day. But the P/L of intraday CNC has an impact. Unrealized profit on the other hand is computer considering the market to market positions, including F&O, intraday equity etc.

Here is an example:

Position A shows loss of 100/- while Position B shows profits of 50/-. Here an unrealized profit of 50/- is generated. This unrealized portion will be reduced from the margin.

Bottom line

Realized and unrealized P&L statements are quite beneficial in helping investors and traders understand how much they have made in a day’s trade or single trading endeavor. It’s a way to manage your trades and understand how much you might be taking home after a successful trading day. Furthermore, these attributes also help understand how many trades have been executed and what your brokerage charge might be based on the amount and number of trades executed.

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Discussion (5)

Unrealised profits are generally screened for an investor to know, how much he/she will gain if they sell the share at that point in time. It is a good way to make trading decisions,

Unrealised profits are theoretical gains from investments that aren't yet sold for cash that are displayed in your broker's account. A realized gain or loss happens when you sell an investment and the sale proceeds are credited to your bank account.

Some unrealised income appearing in p&l account of zerodha console. It is not in portfolio. why?

How many days to return the unreleased margin to return

What is difference between realised p & L and realizes p&L pct

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