In accounting and investment, what are the difference and relation between balance and position, when talking about a checking/saving/investment account? Or are they the same concept?
Thanks and regards!
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6You have a position in FlyByKnight Co. if your investment portfolio includes FlyByKnight Co. shares that you have bought. This position has a value that keeps changing in accordance with market fluctuations in FlyByKnight share value. There is always the possibility that the position will become worthless if FlyByKnight Co. goes down the tubes. You have a balance in your checking or savings account that does not change in value due to market fluctuations and that will become worthless only if the currency collapses completely.– Dilip SarwateApr 23, 2012 at 13:58
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1I don't know if these two words can be defined out of context, although Dilip's answer/comment seems to be a good definition.– JTP - Apologise to Monica ♦Apr 23, 2012 at 14:44
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1 Answer
an account balance is your total in the account.
The word balance means "to be equal". The use in finance stem from accounting. However you do not need to know why its called a balance to understand that a balance is equal to something.
IE: your "account balance" is your total account weather its savings, electric bill, or investment portfolio.
A position in your investment portfolio is what you are invested in.
IE: If I went 100 shares long(I bought) Apple then I have a 100 share position in Apple.
Your position is added to your account balance within your investment portfolio.
