Unrealized PnL vs Realized PnL
Open the Binance futures trading page and you'll see two PnL numbers: Unrealized PNL and Realized PNL. Many beginners confuse these, even mistaking floating profit for money already in hand, only to find the actual amount received differs greatly from expectations.
If you haven't opened a Binance account, start by creating one through the Binance registration portal — following along with the actual interface will make things much clearer.
What Is Unrealized PnL
Unrealized PnL (floating PnL) is the paper profit or loss of your current position calculated at the mark price. It changes in real-time with price fluctuations — potentially jumping several times per second.
Formula (Long): Unrealized PnL = (Mark Price - Entry Price) x Position Size
Formula (Short): Unrealized PnL = (Entry Price - Mark Price) x Position Size
Example: You go long 1 BTC at 40,000 USDT, current mark price is 42,000 USDT. Unrealized PnL = (42,000 - 40,000) x 1 = 2,000 USDT.
But note — this 2,000 USDT isn't money you've actually earned, because you haven't closed the position yet. Price could drop at any time, turning floating profit into floating loss.
What Is Realized PnL
Realized PnL is the actual profit or loss from completed trades, including:
- Closing PnL: Profit or loss locked in from partial or full position closes
- Funding fees: Funding rate settlements every 8 hours
- Trading fees: Fees from opening and closing positions (usually negative)
Realized PnL doesn't change once generated — it genuinely reflects your actual income and expenses.
Where to View on the Binance APP
On the futures trading page in the Binance APP, the bottom has a "Positions" tab:
- Position list: Green or red numbers beside each position are unrealized PnL
- Tap a specific position: See detailed info including entry price, mark price, liquidation price, etc.
- Switch to "Closed" tab: View historical realized PnL
On the web version, the position panel displays the same information and can toggle between percentage and amount display.
Common Points of Confusion
Floating profit isn't actual profit
Many beginners get excited at floating gains, thinking the money is earned. Only PnL realized after closing counts. One market pullback and floating profit can vanish instantly.
Realized PnL includes fees
If you frequently open and close positions, fees accumulate. You might be slightly profitable on each trade but have negative realized PnL because fees ate the profits.
Funding rate impact
A funding rate is settled every 8 hours during holding — this goes into realized PnL. For long-term holds, the funding rate can be a significant expense or income.
Mark price vs last price gap
Unrealized PnL is calculated using the mark price, but you actually close at the market execution price. The two may differ, so actual closing amounts may not exactly match displayed unrealized PnL.
ROE vs PNL
The interface also shows ROE (Return on Equity) — the percentage return based on your deposited margin.
For example: 1,000 USDT margin, 10x leverage for a 10,000 USDT position, floating profit of 500 USDT. PNL shows +500 USDT, ROE shows +50% (500/1,000).
ROE looks impressive, but remember — it's a leveraged number. The actual risk exposure is equally amplified.
How to Use These Metrics
Take-profit reference: When unrealized PnL reaches your target, close promptly to lock in profit — don't get greedy.
Cost assessment: Regularly review the fees and funding rates within realized PnL to evaluate whether your trading costs are reasonable.
Performance review: Realized PnL is the core metric for evaluating trading strategy effectiveness — regular analysis helps optimize your approach.
Understanding these two PnL concepts is fundamental to good futures trading. Floating profit isn't real — only locked-in gains count.