Series 14: 4.1.1.2. Adjustments To Net Worth

4.1.1.2. Adjustments to Net Worth

Net worth is usually calculated from the assets and liabilities contained on the firm’s balance sheet. For purposes of calculating net capital, the SEC requires certain adjustments to be made to a broker-dealer’s net worth.

Unrealized profits. These are earned profits that have not yet been delivered or cashed in. A stock that has risen in value but not been sold is one example. A listed call option whose underlying security is currently priced higher than its exercise price is another. A market gain o