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3.6 Profit and Loss Calculations

July 24, 2020

The “P&L” (Profit and Loss) number you will see on CoinFLEX is there for your reference. We have picked one standard of calculation. This number does not affect the functioning of the exchange, margining, reserved balances, etc.

 

CoinFLEX does not differentiate between realized and unrealized P&L, as gains/losses from price changes are reflected in the account balances immediately.

 

CoinFLEX keeps track of the average entry price for all open positions and uses that to calculate P&L. This is best shown using a series of examples.

 

Example 1:

 

Trade Long/Short Quantity Contract Price
1 Long 10 BTC-USD-SWAP-LIN 9000
2 Long 10 BTC-USD-SWAP-LIN 10000
Current market price 11000
%E8%9E%A2%E5%B9%95%E6%88%AA%E5%9C%96 2020 07 24 %E4%B8%8B%E5%8D%886.47.43 3.6 Profit and Loss Calculations

Example 2:

 

Trade Long/Short Quantity Contract Price
1 Short 10 BTC-USD-SWAP-LIN 9000
2 Long 10 BTC-USD-SWAP-LIN 10000
3 Long 10 BTC-USD-SWAP-LIN 11000
Current market price 10000
%E8%9E%A2%E5%B9%95%E6%88%AA%E5%9C%96 2020 07 24 %E4%B8%8B%E5%8D%886.47.49 3.6 Profit and Loss Calculations

This is because the first two trades have closed out the earlier position.

 

Example 3:

 

Trade Long/Short Quantity Contract Price
1 Long 5 BTC-USD-SWAP-LIN 9000
2 Long 5 BTC-USD-SWAP-LIN 10000
3 Short 5 BTC-USD-SWAP-LIN 10000
3 Long 10 BTC-USD-SWAP-LIN 11000
Current market price 10000
%E8%9E%A2%E5%B9%95%E6%88%AA%E5%9C%96 2020 07 24 %E4%B8%8B%E5%8D%886.48.00 3.6 Profit and Loss Calculations

 

The average entry price after the first 3 trades is applied at the reduced quantity when calculating the average price, as trade 3 reduced exposure. After the first three trades, the remaining balance is 5 BTC at average entry price of 10500.