> ## Documentation Index
> Fetch the complete documentation index at: https://docs.kairos.trade/llms.txt
> Use this file to discover all available pages before exploring further.

# Positions & PnL

> Understanding your positions, calculating profit and loss, and settlement

Once an order fills you're holding something. This chapter covers what a position is, the two ways it can end — you sell, or the market resolves — and exactly how Kairos turns that into a profit-and-loss number.

## What Is a Position?

A **position** is simply shares you're holding. When you buy shares, you open a position. When you sell them, you close it.

| Action | Result |
| - | - |
| Buy 50 Yes shares | You have a **long Yes** position of 50 |
| Buy 30 No shares | You have a **long No** position of 30 |
| Sell your 50 Yes shares | Position closed |

## Long Yes vs Long No

In prediction markets, you can be:

* **Long Yes** — You think the event **will** happen. You profit if it does.
* **Long No** — You think the event **won't** happen. You profit if it doesn't.

**Example: "Will it snow in April?"**

Current prices: Yes = $0.20, No = $0.80

| Outcome | Long Yes (bought at \$0.20) | Long No (bought at \$0.80) |
| - | - | - |
| It snows | +\$0.80 profit | -\$0.80 loss |
| No snow | -\$0.20 loss | +\$0.20 profit |

## Calculating Profit & Loss (PnL)

Your PnL depends on what you paid and what you got.

### If you sell before resolution:

<Note>
  **PnL = (Sell Price - Buy Price) x Quantity**
</Note>

**Example:** Bought 100 Yes at $0.40, sold at $0.65:

| | |
| - | - |
| Sell Price - Buy Price | $0.65 - $0.40 = \$0.25 |
| x Quantity | x 100 |
| **PnL** | **+\$25.00** |

### If you hold until settlement:

<Note>
  **PnL = (Settlement Value - Buy Price) x Quantity**
</Note>

**Event happens** — settles at \$1.00:

| | |
| - | - |
| Settlement - Buy Price | $1.00 - $0.40 = \$0.60 |
| x Quantity | x 100 |
| **PnL** | **+\$60.00** |

**Event doesn't happen** — settles at \$0.00:

| | |
| - | - |
| Settlement - Buy Price | $0.00 - $0.40 = -\$0.40 |
| x Quantity | x 100 |
| **PnL** | **-\$40.00** |

## Closing a Position

You don't have to wait for the market to resolve. You can close your position at any time by selling your shares back into the order book.

**Why close early?**

* **Lock in profit** — The price moved in your favor, take the win
* **Cut losses** — You changed your mind, sell before it goes to zero
* **Free up capital** — Put that money into another trade

## Settlement — How Markets Resolve

When the real-world event happens (or doesn't), the market **resolves**:

* **Yes outcome:** All Yes shares become worth $1.00, all No shares become $0.00
* **No outcome:** All No shares become worth $1.00, all Yes shares become $0.00

Settlement is automatic. Your shares are converted to cash and added to your balance.

On the on-chain venues (Polymarket, Predict.fun) that conversion is a
**redemption transaction**, which Kairos submits for you once the market
resolves on-chain. It is not instantaneous: a position can sit marked
*redeemable* between resolution and the redemption landing, and a backstop
sweep catches any that the live path missed.

> **Example:** "Will Team A win the finals?" — Team A wins!
>
> Your 50 Yes shares x $1.00 = **$50.00 deposited\*\*. Position closed automatically.

## Unrealized vs Realized PnL

| Type | Meaning |
| - | - |
| **Unrealized PnL** | Profit/loss on shares you still hold, based on the current market price. Changes as prices move. |
| **Realized PnL** | Profit/loss that's locked in — you sold the shares or the market settled. Real money. |

> **How Kairos computes it:** if you bought the same outcome at several prices,
> "your buy price" is not one number. Kairos matches sells against your buy lots
> **FIFO** — oldest lot first — so realized PnL reflects the cost of the specific
> lots you sold, and unrealized PnL is the mark price applied to your remaining
> cost basis. The `/pnl` endpoints report `cost_basis_usd` and `avg_entry`
> alongside realized and unrealized figures. See [PnL](/rest/pnl).
>
> The formulas above also ignore fees. Your actual result is net of the Kairos
> platform fee and any exchange fee on both the entry and the exit — see
> [Fees](/trading/fees).

**Example:** You bought 100 Yes at $0.40 (cost: $40). Current price: \$0.55.

> Unrealized PnL = ($0.55 - $0.40) x 100 = **+\$15.00**
>
> You sell at $0.55 — that $15.00 becomes **realized PnL**.

## Risk and Reward

The most you can lose is what you paid. The most you can gain is \$1.00 minus what you paid.

| Buy Price | Max Loss | Max Gain |
| - | - | - |
| \$0.10 | \$0.10 | \$0.90 |
| \$0.50 | \$0.50 | \$0.50 |
| \$0.90 | \$0.90 | \$0.10 |

Cheap shares have high upside but low probability. Expensive shares are safer bets but with smaller payoffs. There's always a tradeoff.

**Next:** the [Glossary](/learn/glossary) for a quick reference on any term, or [Fees](/trading/fees) for what these figures look like net of costs.


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