Equity is your account’s real-time value, including your balance plus any unrealized profit or loss from open positions.
Formula
Equity = Balance + Floating Profit/Loss
Example
- Balance: $10,000
- Open trade: +$300 floating profit
- Equity: $10,300
If the trade moves to -$200:
- Equity: $9,800
- Balance: still $10,000 (unchanged)
Why Equity Matters
| Metric | Based On |
|---|---|
| Balance | Closed trades only |
| Equity | Balance + Open trades |
| Margin level | Equity / Used Margin |
- Margin calls trigger based on equity, not balance
- Available margin = Equity - Used margin
- If equity drops below margin requirement, positions may be closed
Key Points
- Equity fluctuates every second with open positions
- Always monitor equity, not just balance
- Low equity relative to margin = high risk of margin call