Risk & Money ManagementUnrealised Profit and LossOpen P/L
Floating P&L
The unrealised profit or loss on open positions, marked to the current market price and changing with every tick.
What Floating P&L means
Floating profit and loss is calculated as the difference between the entry price and the current closing price, multiplied by the contract size and the number of lots, then converted into the account currency where required. Crucially, the current price used is the one at which the position would actually be closed, so a long is valued at the bid and a short at the ask. Most platforms also show accrued swap alongside the figure, sometimes included in the total and sometimes as a separate column.
The number matters because it feeds directly into equity, and therefore into free margin, margin level and every liquidation decision the broker makes. What it is not is spendable money. Unrealised gains can disappear entirely in a single session and cannot be withdrawn, while unrealised losses do not reduce the balance until a position is closed. Many jurisdictions also treat unrealised amounts differently from realised ones for tax purposes, so the distinction has record-keeping consequences as well as trading ones.
Worked example
A long position of one standard lot of EUR/USD opened at 1.0850 with the current bid at 1.0875 shows 25 pips in favour, or about 250 dollars of floating profit, before commission and any accrued swap are deducted.
Related terms
- Realised P<he profit or loss locked in when a position is closed, net of spread, commission and financing costs.
- EquityThe live value of a trading account: balance plus the floating profit or loss of every open position.
- Account BalanceThe cash value of an account reflecting only completed transactions, before open positions are marked to market.
- PipThe standard smallest conventional price increment in a currency pair - the fourth decimal place, or the second on yen pairs.
- ExposureThe total market risk an account carries, measured by the aggregate notional value of its open positions.
Frequently asked questions
What does Floating P&L mean in forex trading?
The unrealised profit or loss on open positions, marked to the current market price and changing with every tick.
How does Floating P&L work in practice?
The number matters because it feeds directly into equity, and therefore into free margin, margin level and every liquidation decision the broker makes. What it is not is spendable money. Unrealised gains can disappear entirely in a single session and cannot be withdrawn, while unrealised losses do not reduce the balance until a position is closed. Many jurisdictions also treat unrealised amounts differently from realised ones for tax purposes, so the distinction has record-keeping consequences as well as trading ones.
What is an example of Floating P&L?
A long position of one standard lot of EUR/USD opened at 1.0850 with the current bid at 1.0875 shows 25 pips in favour, or about 250 dollars of floating profit, before commission and any accrued swap are deducted.
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