PnL stands for Profit and Loss. Tracks how much you've made or lost on a trade or across your whole portfolio.

Two versions. Unrealized and realized. Sounds simple. The difference trips up a lot of traders.

Unrealized PnL

Unrealized PnL is your paper gain or loss on a position still open.

Bought ETH at $2,000. Now trading at $2,800. Unrealized PnL: up $800.

That $800 isn't in your account. It's floating. Position still live. Price still moving.

ETH drops back to $2,100 before you sell. Unrealized PnL collapses to $100. You watched $700 disappear without touching a button.

Unrealized PnL shows where you stand right now. Not what you made.

Realized PnL

Realized PnL is what you locked in by closing.

Same trade. Bought ETH at $2,000. Price hits $2,800. You sell.

Realized PnL: $800 profit. In your account. Done. Whatever ETH does after that point is irrelevant.

Only number that actually matters. Everything else is hypothetical until the trade closes.

Why the Difference Matters

New traders obsess over unrealized PnL. Checking every ten minutes. Up $500. Down $300. Up $700.

None of it means anything until it's realized.

Classic mistake. Position runs 300% unrealized. Trader holds. Convinced it goes higher. Price reverses hard. Unrealized PnL collapses. Panic sell near the bottom. Walks away with a fraction of what the screen showed.

The 300% existed as a number. Never became real money.

Flip side matters too. Unrealized loss isn't a realized loss yet. Position down 30% but the thesis still holds? Nothing is locked in. Panic selling turns a paper loss into a permanent one.

How PnL Gets Calculated

Exit price minus entry price, multiplied by size.

• Long. Bought 2 ETH at $2,000. Sold at $2,500.
  • PnL: ($2,500 - $2,000) x 2 = $1,000 profit.
• Short. Sold 2 ETH at $2,500. Bought back at $2,000.
  • PnL: ($2,500 - $2,000) x 2 = $1,000 profit.

Always subtract fees. Entry, exit, funding costs on leveraged positions. Gross PnL looks better than net. Net is the real number.

Fees Eat More Than People Expect

Trade showing $200 gross profit. Entry fee plus exit fee on a leveraged perpetual. Net comes out $140.

Doesn't sound catastrophic on one trade. Run that same friction across dozens of trades a week and the gap compounds into something significant.

Track net PnL. Not gross. That's the actual score.

PnL FAQ

Why do traders track monthly PnL instead of per trade?

Single trades swing on luck and short-term noise. Monthly PnL smooths that out. Shows whether the strategy actually works over time. One big win hiding ten small losses looks fine per trade. Monthly view exposes it.