Open Position

An open position is any trade you've entered that is still live — you've bought or sold something, but you haven't yet done the opposite trade to finish it off. If you bought 100 shares of a stock and still hold those 100 shares, that's an open position. The moment you sell them, the position closes.

A position opens the instant your order fills. From that point on, its value moves up and down with the market, and you have what's called unrealized profit or loss — a paper gain or loss that isn't locked in yet because you still hold the position. It only becomes real ("realized") once you close it out, either by selling (if you were long) or buying back (if you were short, meaning you sold first and plan to buy later).

The nuance beginners often miss is that an open position carries risk for as long as it stays open, even overnight or over a weekend, when markets can gap on news and you can't react. A position isn't "safe" just because it's currently showing a profit — that profit is only on paper until you close it. Traders also sometimes confuse "open position" with "open order": an open order is a request waiting to be filled (like a limit order sitting unfilled), while an open position is the actual holding you already have after a fill.

Brokers typically show your open positions on a dedicated screen, listing what you hold, at what average price, and your current unrealized profit or loss on each one.