House's Money

House's money refers to an investment loss that has not touched the investor's principal money or capital. If an investor invested an initial $10,000 on a stock and rose to a total value of $15,000 the following month the portfolio has a $5,000 gain. If the stock fell on the second month and the investor's portfolio is down to $11,000, the $4,000 loss is house money and technically not the investor's principal money.

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