The composition of a user's Futures account assets is the deposit amount + realized profit and loss + unrealized profit and loss. Understanding how perpetual futures’ profits and losses are calculated can help you manage your account assets.
I. Unrealized Profit and Loss
Unrealized Profit and Loss (PnL) refers to the estimated profit or loss generated from closing the current position based on the last traded price in the market. Unrealized PnL fluctuates with the last price, hence it is also known as floating PnL or paper profit or loss. It is only a reference to the current position's potential profit or loss and does not reflect the actual profit or loss until the position is closed.
Unrealized PnL of long positions = (Last price – Average entry price) * Position size
Unrealized PnL of short positions = (Average entry price - Last price) * Position size
*Average Entry Price: The average cost price of opening the position, representing the user's actual average opening price. This price is used to calculate the unrealized PnL of the user's position. Additionally, positions of the same symbol and direction will be merged for calculation.
Suppose you open 10 conts of BTC long positions at a price of 10,000 USDT and another 10 conts of BTC long positions at a price of 12,000 USDT. The average entry price would be (10,000 * 10 + 12,000 * 10) / (10 + 10) = 11,000 USDT.
Example:
You buy 10 BTC in the futures market at an average entry price of 10,000 USDT. If the current BTC last price is 12,000 USDT, your unrealized PnL would be (12,000 - 10,000) * 10 = 20,000 USDT.
II. Realized Profit and Loss
Realized Profit and Loss refers to the actual profit or loss realized after closing a position. When the realized PnL is greater than zero, it can be used as margin or withdrawn.
Realized PnL of long positions = (Exit price – Average entry price) * Position size
Realized PnL of short positions = (Average entry price - Exit price) * Position size
Example:
You sell 10 BTC in the futures market with an average entry price of 10,000 USDT. If you close the position when BTC drops to 8,000 USDT, your realized PnL would be (10,000 - 8,000) * 10 = 20,000 USDT.
III. Unrealized PnL Counted as Realized PnL
Unrealized PnL is counted as realized PnL under the following conditions:
1. When the position is closed or reversed (i.e., net long position becomes net short position, or net short position becomes net long position).
2. If the absolute value of unrealized PnL > 1% * effective margin and the absolute value of unrealized PnL ≥ 10 USDT every 5 minutes.
Note: Positive unrealized PnL is taken into the account's margin only after being counted as realized PnL. PnL is settled in USDT at market price.
IV. ROI
ROI is a ratio that measures the profitability of a position by comparing the profit or loss to its cost.
ROI of long positions: (Last price / Average entry price - 1) * Leverage
ROI of short positions: (1 - Last price / Average entry price) * Leverage
How to check ROI:
1.For the open position's ROI, you can check it next to unrealized PnL in the Positions section of the futures trading page or in the Positions section of your Futures account.
2.For closed orders, you can find the ROI of each order in the Trade History section of the futures trading page.
