Loss on Paper: Definition, Calculation, Importance

What Is a Loss on Paper?

By Keith Noonan – Updated Sep 6, 2025 at 2:57 PM EST

Key Points

Paper loss: difference between current and purchase prices, not actual until sold.
Tracking paper gains/losses informs buying/selling decisions based on performance snapshots.
Real profit or loss occurs only when assets are sold for cash, solidifying the result.

At its core, investing is about buying things with the expectation that they will increase in value over time. If your investments have decreased in value, you will have a loss on paper.

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calculator and holding a paper — Image source: Getty Images.

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About the Author

Keith Noonan is a contributing writer at The Motley Fool covering technology, consumer goods, and other sectors. He holds a bachelor’s degree in English from Boston College.

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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool has a disclosure policy.