Position

A position is a trader's current holding or exposure in an asset — the amount bought (a long position) or sold/borrowed against (a short position) that has not yet been closed. Opening a position means entering the trade; closing it means exiting and realizing the profit or loss.

For example, buying 0.5 BTC at $60,000 opens a long position worth $30,000. If BTC rises to $66,000 and you sell, you close the position with a $3,000 realized gain. Until you sell, the gain is unrealized: it exists on paper and can shrink or reverse.

In derivatives trading, a position also carries a size, direction, leverage, entry price, and liquidation price, and exchanges display its unrealized profit and loss in real time. Position management — deciding how large a position should be, where to exit, and when to reduce it — is generally considered more important to long-term results than entry timing. A common misconception is that an unrealized profit is "money made"; nothing is locked in until the position is actually closed, and many traders have watched large paper gains round-trip to losses.