Well, I'm going to explain something that many people confuse when they start trading: what exactly is this PNL everyone talks about.

So here it is, imagine you buy a coffee for 50, and an hour later you sell it for 70. You made +20, that's your profit. But if you sold it for 40, you'd be at -10. That's basically what PNL is. In the crypto market, it's exactly the same logic, except it moves much faster and we're talking about thousands of dollars instead of coffees.

PNL is the abbreviation for Profit and Loss, so profit and loss. It's simply the difference between the price at which you bought an asset and the price at which you sold it. You subtract the platform's commissions, and there you go, you have your result. If it's positive, you've gained. If it's negative, you've lost. It's like a thermometer for your trading, in a way.

Let's take a concrete example. Say you buy 0.1 BTC at $40,000, so you spend $4,000. Then the price rises and you sell at $42,000, which gives you $4,200. Mathematically, you have +$200, but after deducting the exchange's commission, you're left with about +$198. That's your PNL.

The formula is simple: Sale price minus purchase price, multiplied by the amount of the asset, minus commissions. That gives you your PNL.

Now, there are two types of PNL to understand well. There's unrealized PNL, which is when your position is still open and you're looking at your profit or loss on paper. And then there's realized PNL, which is once you've closed your position and the money is actually in your wallet. These are two different things.

You will also encounter related terms like ROI, which is the return in percentage. Or margin, which is your collateral to hold a position. And then there's leverage, which can really amplify your PNL, both up and down.

So, in summary, PNL is your friend for tracking your trading performance. It tells you exactly where you stand with each transaction. And if you take it seriously, it's a good indicator to understand whether your trading strategy is really working or not.