Why Your Unrealized P&L Doesn't Match Your Closed P&L: A Complete Breakdown

When you close a trading position, you might notice something puzzling: your unrealized p&l looked promising, but your closed P&L tells a different story. This confusion stems from a fundamental misunderstanding about what each P&L metric actually measures. In reality, they’re tracking different things at different stages of your position lifecycle. To become a more effective trader, you need to grasp the crucial distinction between these three P&L types: Unrealized P&L, Realized P&L, and Closed P&L.

The core reason for these discrepancies isn’t a calculation error—it’s the cumulative impact of fees. Trading fees to open and close your position, coupled with funding fees for holding perpetual contracts, gradually erode what initially looked like a profitable trade. Understanding this relationship is the key to predicting your actual profit or loss before you hit that close button.

The Three Pillars of P&L: Understanding Each Type’s Unique Purpose

P&L tracking on trading platforms comes in three distinct flavors, each serving a specific purpose in your trading journey. Think of them as three snapshots taken at different moments: during your position, as it’s winding down, and after everything’s final.

The first metric, Unrealized P&L, is your real-time position estimate—what your profit or loss would be if you closed right now at current market prices, assuming zero fees. It updates constantly as the market moves, giving you an instant sense of directional correctness.

The second metric, Realized P&L, captures your actual gains or losses as they accumulate throughout the position’s life. Unlike unrealized, it includes all fees paid so far—both trading fees and funding fees—making it your honest interim assessment.

Finally, Closed P&L is the ultimate truth: your final profit or loss after fully exiting the position, with every penny of fees accounted for. This is what actually enters or leaves your wallet.

Breaking Down Unrealized P&L: Your Real-Time Position Snapshot

When you enter a position and check the Positions tab, the unrealized p&l displayed there represents your paper profit or loss calculated using the platform’s Last Traded Price (LTP). This number updates in real-time as prices fluctuate, making it useful for monitoring your current directional bias.

However, unrealized p&l operates under a critical limitation: it ignores all fees. No trading fees, no funding fees—nothing. It’s a pure mark-to-market calculation. The moment you entered your position, your broker charged you a taker fee. If you’re holding a perpetual contract, you’ve been paying (or receiving) funding payments every eight hours. The unrealized p&l knows nothing of this.

This is why your unrealized p&l often looks significantly better than your closed P&L. It’s not including the price you’ll pay to exit, nor the cumulative funding fees you’ve already borne. Think of it as an optimistic estimate that says, “At current prices, you’d have this much,” without factoring in the operational costs of your trade.

What Gets Locked In: The Realized P&L Explained

As your position evolves—whether you’re adding to it, scaling out, or making partial exits—the Realized P&L begins to emerge. This metric captures every cent that’s actually been realized through your actions and forced payments.

Realized P&L is the sum of:

• Your position’s actual profit or loss from executed trades
• All trading fees paid to open the position or increase its size
• All trading fees paid to partially close or reduce the position
• All funding fees accumulated while holding the position

This represents your true financial outcome so far, excluding any unrealized gains or losses from your remaining open portion. Once you fully close the position, realized P&L resets to zero for that position direction, and you look to closed P&L for the final answer.

If you check your unrealized p&l and subtract your realized P&L, that difference tells you what’s actually still “on the table”—your pure price-action profit before exit fees. If unrealized p&l minus realized P&L equals a negative number, that’s a red flag: you’re already in a losing position once you account for fees paid so far.

The Final Reckoning: Closed P&L After All Fees

Closed P&L represents the definitive outcome of your entire position from entry to full exit. You can view this in the Orders section under Closed P&L, where you’ll see two variants:

Closed Orders show the realized P&L from each individual closed transaction. If you scaled out in multiple tranches, each order appears separately with its proportionate share of trading fees and funding fees.

Closed Position consolidates your entire long or short position into one comprehensive record. It shows your opening entry price, your average exit price, and the complete P&L calculation factoring in every cost.

The closed P&L calculation follows this logic:

Position P&L (entry to exit prices) − Total Trading Fees − Total Funding Fees = Closed P&L

This is your money in or out. Not an estimate, not provisional—final.

How Fees Transform Your Numbers: The Fee Impact Analysis

Fees operate in two stages and can substantially shrink your profitability. The fee-to-open charge hits you immediately when you create the position. The fee-to-close hits you on the way out. The sum of both, plus all funding fees accumulated during the holding period, represents the total friction cost of your trade.

For example, on a 0.002 BTC position at 43,807.30 entry price with standard maker/taker fees of 0.055%, your opening fee alone costs roughly 0.048 in USDT. Your closing fee at exit price (say 43,704.00) costs another 0.048. If you held during periods of negative funding, you might have paid an additional 0.014 in funding fees. These three components sum to approximately 0.11 USDT—meaning your unrealized p&l needs to clear this hurdle before your closed P&L goes positive.

This explains the core paradox: you can have positive unrealized p&l (the LTP moved in your favor) yet still realize a loss (because fees consumed your gains). The market gave you 0.22 USDT in price movement, but fees took 0.11, leaving you with approximately 0.11 USDT closed P&L.

Putting It Together: Real-World Calculation Example

Let’s walk through an actual position to see how these pieces fit together:

Position Details:

• Entry: 43,807.30 (0.002 BTC purchased)
• Current market price (LTP): 43,696.60
• Exit price: 43,704.00

Step 1: Calculate Unrealized P&L

Unrealized P&L = Price movement × Quantity = (43,696.60 - 43,807.30) × 0.002 = −0.2214 USDT

Wait—this is negative because the market moved against you initially. But in our actual example, let’s say the LTP is at a level generating +0.2214 USDT unrealized profit.

Step 2: Account for Fees Paid So Far

• Fee to open = 0.04818803 USDT
• Funding fees accumulated = −0.01420107 USDT (you received a net positive from funding)
• Realized P&L = 0.2214 − 0.04818803 − (−0.01420107) = −0.0339 USDT

So far, despite your unrealized profit, you’re actually down 0.0339 due to opening fees exceeding your funding gains.

Step 3: Calculate Closed P&L

• Fee to close = 0.04807440 USDT
• Total trading fees = 0.04818803 + 0.04807440 = 0.09626243 USDT
• Total funding fees net = −0.01420107 USDT
• Position P&L (pure price) = 0.002 × (43,807.30 − 43,704.00) = 0.2066 USDT

Closed P&L = 0.2066 − 0.09626243 − (−0.01420107) = 0.12453864 USDT

Your final closed P&L: +0.125 USDT

This is lower than your unrealized p&l of +0.2214 because the exit fee and remaining fee components reduced your net outcome by approximately 0.097 USDT.

Predicting Your Closed P&L Before You Exit

You now understand why your unrealized p&l looked good but your closed P&L might disappoint. To estimate your closed P&L before actually closing, subtract your realized P&L from your unrealized p&l. If that number is negative, expect a loss when you exit. If it’s positive, you’re likely to profit once you close.

Remember: leverage affects your ROI percentage (by changing your margin requirement) but not your absolute P&L amount. Your fees and price action determine your profit or loss in USDT terms, regardless of leverage employed.

Understanding these three metrics transforms you from a trader guessing at outcomes to one confidently predicting them. Your unrealized p&l is your optimistic scenario. Your realized P&L is your halfway honest assessment. Your closed P&L is the ultimate scoreboard. Armed with this knowledge, you can make better decisions about scaling, averaging, or exiting your positions with full awareness of the fee structure working against every trade.