Forex Dictionary Terms

Virtual Balance

Posted on

Definition – What does Virtual Balance mean?

Virtual balance refers to the potential account value a trader would have if he closed out all his open positions. A virtual balance is essentially a real-time measure of an accounts unrealized profit (or loss) plus any cash balance. Traders calculate their virtual balance to get an idea of how their account is doing as a whole.

ForexTerms explains Virtual Balance

A virtual balance is fairly easy to calculate. It simply requires tallying up the cash balance plus or minus the current value of open trades. Traders use a virtual balance to evaluate the day’s trading without closing out positions they want to let run. A virtual balance is a useful performance measure, but the value of unrealized gains or losses really only matter once a position is closed and those gains or losses become realized. A trader may see his virtual balance grow and shrink many times during a trading session.

Other Terms

Random Articles