Meaning & use
paper profits
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Meanings
nounplural
Gains that exist only on paper because an asset has risen in value but has not yet been sold.
Grammar: Used as a plural noun; it takes a plural verb: paper profits were wiped out.
Patterns
- paper profits on something
- make paper profits
- paper profits of $...
The fund showed paper profits of two million dollars, but nothing had been sold.
When the market fell, their paper profits disappeared overnight.
He was excited about the paper profits on his shares until he tried to cash them in.
nounpluraltechnicalbusiness
In accounting, profits recorded in the books that may not represent real cash received.
Grammar: Often used with accounting verbs: record, report, recognize paper profits.
Patterns
- record paper profits
- report paper profits
- recognize paper profits
The company reported paper profits from an asset revaluation rather than from sales.
Auditors warned that the paper profits were not backed by cash.
Under the new rules, firms must disclose paper profits separately.
Common combinations
- paper profits on shares
- She had large paper profits on shares she had bought years ago.
- make paper profits
- Traders can make paper profits quickly in a rising market.
- paper profits vanish
- Paper profits vanish as soon as prices drop.
- realize paper profits
- You only realize paper profits when you sell the asset.
Synonyms and how they differ
- unrealized gains
- The formal accounting term; it is more precise and is used in financial statements.
- book gains
- Similar but broader; it can include gains recorded for accounting reasons, not just market rises.
Opposites
Word family
- paper loss noun
- A loss that exists only on paper because an asset has fallen in value but has not been sold.
- realized profit noun
- Profit that has actually been received after selling an asset.
Commonly confused: paper profits or realized profits?
paper profits vs realized profits
Realized profits are actual cash gains after a sale; paper profits are only theoretical until you sell.
Practice
Which sentence uses 'paper profits' correctly?
Choose one answer.
Paper profits exist only before selling, so the sentence about watching them grow without selling fits. Option B is wrong because selling turns them into realized profits, not paper profits.
Make it your own
Write a sentence using “paper profits”, then check it and compare it with the examples above.