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How Do Fees Affect Holdings and Profit/Loss Figures
How Do Fees Affect Holdings and Profit/Loss Figures

In this article, you will learn how the fees of transactions affect the holdings and the profit/loss figures for transactions and holdings.

Written by Mariam
Updated over a week ago

Let's explore the topic with an easy-to-grasp example:

Assume that you have 200 USDT deposited. You purchased 1 ETH at \$1250 and paid a fee of 100 USDT. The current price of ETH is \$1188.75.

Firstly, before moving on to examining how your holdings will be displayed after these two transactions, let us consider how the P/L figure is calculated for the ETH transaction.

It is calculated as follows:

1 * \$1188.75 - 1 * \$1250 - 100 * \$0.9994 (the price of USDT at that moment) = -\$161.19

The current price of ETH is \$1188.75, but the cost of that ETH is \$1250 plus the \$100 paid in fees.

Your holdings will be displayed as shown in the screenshot below:

Now, in such a case, you will only have 100 USDT left in your portfolio, as the other 100 was deducted as a result of paying the fee for ETH.

The All Time P/L for Ethereum is calculated as follows:
\$1188,75 (current worth) - \$1250 (purchase cost) = -\$61.25

The All-Time P/L for USDT is -\$100 as the fee is always calculated as a loss. It is important to note that the fee is calculated as a loss on the coin's holdings with which the fee was paid (in this case, USDT).

This is the case for any coin and both auto-synced and manual portfolios.

In a Manual Portfolio, you can also add a transaction in which you pay the fee in the same currency which you are buying/selling. For example, let's assume that you've purchased 1 ETH at \$1250 and paid a fee of 0.1 ETH.

The transaction details will be reflected as shown in the screenshot below.

Now, it is important to understand how the P/L is calculated in this case.

1 * 1187.65 - 1 * 1250 - 0.1 * 1250 = -\$187.36

The logic behind this is that you purchased 1 ETH for \$1250, and paid a fee of 0.1 ETH, so it costs you 1 * \$1250 + 0.1 * \$1250 = \$1375 to purchase that 1 ETH and its current price is \$1187.65, which means that the Loss for the transaction is \$1187.65 - \$1250 = -\$187.36.

In the Holdings tab, however, the amount of Ethereum will be 0.9 instead of 1, as you purchased 1 ETH, but you also paid a fee of 0.1 ETH, which needs to be deducted from your holdings.

Now, in such a case, how is the P/L calculated?

It is calculated as follows:

0.9 * \$1187.65 - 1 * \$1250 = -\$181.115

The most basic way to think about it is that you have 0.9 ETH, and the current value of 1 ETH is \$1187.65, so the current value of 0.9 ETH is \$1250. However, you essentially paid \$1250 for that 0.9 ETH that you currently have (0.9 * \$1250 + \$125 fee = \$1250), so the Loss is -\$181.115.

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