#assets
What does it mean of daily PNL?
"Daily #pnl " stands for Daily Profit and Loss. It represents the change in the value of a trading portfolio or a specific position over a single trading day. In essence, it tells you how much money you made or lost on your investments or trades from the close of the previous day to the close of the current day.
Here's a breakdown of what it means:
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Profit (Positive PNL) If your portfolio or position has increased in value since the previous day's close, you have a positive daily PNL, indicating a profit.
Loss (Negative PNL): If your portfolio or position has decreased in value since the previous day's close, you have a negative daily PNL, indicating a loss.
How is Daily PNL calculated (generally)?
The most basic way to calculate daily PNL is:
Daily PNL = Value today - Value from Prior Day
More specifically, for individual trades:
For a long position (you bought hoping the price would go up): (Current Price - Previous Closing Price) x Quantity of Asset
For a short position (you sold hoping the price would go down): (Previous Closing Price - Current Price) x Quantity of Asset
It's important to note that daily PNL can be further broken down into:
Realized PNL: This is the actual profit or loss from trades that have been closed (i.e., you've sold the Asset).
Unrealized PNL: This is the potential profit or loss on open positions that haven't been closed yet. It's often called "paper profit/loss" because it only becomes real when you close the trade.
