Question 1

How is profit calculated for a long trade?

Accepted Answer

Long P&L = (Exit Price − Entry Price) × Position Size. If you bought 100 shares at $50 and sold at $60, profit = ($60 − $50) × 100 = $1,000. As a percentage: ($1,000 ÷ $5,000 initial value) × 100 = 20%.

Question 2

How is profit calculated for a short trade?

Accepted Answer

Short P&L = (Entry Price − Exit Price) × Position Size. If you shorted 100 shares at $60 and covered at $50, profit = ($60 − $50) × 100 = $1,000. Short profits are capped at 100% (asset goes to zero) but losses are theoretically unlimited.

Question 3

Does this calculator account for trading fees?

Accepted Answer

There is an optional fees input. Enter your total round-trip costs (entry + exit commissions plus spread) to see net P&L after fees. For spot crypto trades, typical exchange fees are 0.1% per side on major exchanges.

Question 4

What is return on margin vs return on investment?

Accepted Answer

Return on investment (ROI) divides profit by the total position value. Return on margin divides profit by the margin (deposit) used for a leveraged position. At 10x leverage, a 1% position gain = 10% return on margin. Both calculations are shown by this tool.

Profit Calculator