How to Use PNL on Binance Exchange
PNL (Profit and Loss) is a metric that shows the difference between profit and loss in trading. To calculate it, you can use different data:
one trade or open position;
a series of executed trades (5, 10, 20, 100 pieces);
all trades over a specific period (week, month, year);
trades opened by a single strategy.
When performing such calculations, a special P&L report is generated, which allows the trader to determine the effectiveness of their trading as well as their ability to generate profit.
To calculate the P/L of a trade, you need to know the size of the open position and the market price change. The actual profit or loss will equal the size of the position multiplied by the movement in points. This calculation shows results quite accurately.
How PNL is Calculated
You can calculate P&L on the Binance exchange using one of two formulas:
If the trade is opened in Long: unrealized PNL = (Mark price – Initial purchase price) * Position size.
If the trade is opened in Short: unrealized P/L = (Initial selling price – Mark price) * Position size.
Mark price is the value of the asset.