PnL (Profit and Loss)

PnL is the bottom line of a trade or a whole strategy.

long:  PnL = (exit − entry) × quantity
short: PnL = (entry − exit) × quantity

Realized vs unrealized

Unrealized (open) PnL is the mark-to-market gain or loss on a position that is still open. It moves with every tick and it can vanish. Realized PnL is locked in when the position closes, and it is what actually compounds your account.

A strategy's equity curve is the running sum of realized PnL plus the current unrealized PnL. Nearly every performance metric, from Sharpe to max drawdown, is computed from that one series.

Gross vs net

Always judge a backtest on net PnL: after trading fees, slippage, and (for perpetuals) funding. High-frequency strategies that look brilliant gross are routinely unprofitable net, because costs scale with trade count and edge often doesn't.

On AlphaProve

The engine keeps a double-entry ledger, so the net PnL on the tearsheet already has taker and maker fees, spread, slippage, and perp funding taken out before it feeds the return and drawdown figures. The realized-and-unrealized split described above is visible while a run streams: live SSE ticks carry cash, margin, and unrealized PnL bar by bar, and each realized amount lands when its trade closes. The same run reports net PnL in both USDT and percent, not one gross headline.