Equity (Account Equity)

Equity - The real-time value of your trading account, including current profit or loss on any open trades. Equity changes with every tick of price if you have positions open. It’s calculated as: Equity = Balance + Floating P/L (the net profit or loss on open positions). For example, if your account balance is $1,000 and your open trades are currently $-50 in drawdown, your equity is $950. If all trades are closed, equity equals balance. In other words, “Equity shows how much money you would have if you closed all open trades right now”. Forex robots should monitor equity to manage risk (e.g. stopping trading if equity falls to a certain level to avoid margin call).