Forex glossary
Balance
The booked account amount after deposits, withdrawals and settled transactions. It differs from equity, which includes the unrealized result of open positions.
Illustrative example
How does it work in practice?
In a hypothetical account, a booked loss of 40 PLN reduces a 1,000 PLN balance to 960 PLN. A separate open position's unrealized loss of 20 PLN affects equity, not this balance.
One account, four different figures
Balance, equity and available collateral
Model with no credit, fees or blocked amounts: balance 10,000 USD, open P/L −800 USD and used margin 2,000 USD.
On a narrow screen, the table can be scrolled horizontally.
| Term | What it describes | Shared example |
|---|---|---|
| Balance | Booked funds; open P/L does not change balance in this model. | Balance remains 10,000 USD. |
| Equity | Current account value; margin is not deducted from it. | 10,000 − 800 = 9,200 USD. |
| Margin (deposit margin) | Required collateral, rather than a fee already paid. | The positions require 2,000 USD of collateral. |
| Free margin (available margin) | Equity minus margin; not the same as withdrawable cash. | 9,200 − 2,000 = 7,200 USD. |
| Margin Level | Equity relative to margin, expressed as a percentage. | 9,200 / 2,000 × 100% = 460%. |
Takeaway: Identify whether a figure is a booked amount, account valuation, collateral requirement or ratio. Do not deduct margin from equity.
Change an assumption, see the result
What changes if…?
Change balance and open P/L separately. Observe how open valuation changes equity while the booked balance stays fixed.
Model: equity = balance + open P/L; free margin = equity − margin. No credit, fees or other blocks. The stop-out threshold is hypothetical; the actual formula and action depend on the provider’s terms.
Check your understanding
Separate a booked transaction from the P/L of a position still open.
Show the answer and explanation
960 USD
Balance is 1,000 − 40 = 960 USD. Include the separate −20 USD open result when calculating equity.
Reconcile a trade result with the account
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Related terms
Sources and documentation
- MetaTrader 5: executing trades
Execution modes, requotes, position handling and local trailing on this platform.
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The example illustrates the mechanism. Check current account conditions and instrument specifications with the provider.