More helpful investopedia definitions Understanding a Capital Loss
A capital loss is essentially the difference between the purchase price and the price at which the asset is sold, where the sale price is lower than the purchase price. For example, if an investor bought a house for $250,000 and sold the house five years later for $200,000, the investor realizes a capital loss of $50,000
OR, IF an investor bought more than 5 million shares, but less than 10 million shares as high as $3, $2, $1.20 and as low as $0.21 for an average of say $0.70, the total cost would be a giant mansion outside of the bridle path or Belmont ave in Vancouver, at > $3.5 million, but < $7.0 million. Or an entire small town in rural Sask.
SO.... when he sells it 5 years later at $0.05 that's a loss of > $3.25 million < $6.5 million. Or he can hold out for the ultimate loss when, as predicted about 437 times, it goes bankrupt, and the Capital Loss is > $3.5<$7.0. But hey! Those gargantuan losses can be used to offset the gains in the rest of the portfolio!
As a side note, if an investor "can't sell", and/or is convinced it's going to zero, and has notionally accepted its worth zero anyway, the investor can donate those shares to any registered charity and get a tax deduction for whatever the stock price closes at on that day of the donation. So at $0.05 a donation of >$250,000<$500,000 can be made to any one or several very worthy causes. But hurry, if you wait until it's halted, the charity will get zero, just like the investor.
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