Balance
Quick Answer
Balance is the amount recorded in a trading account after completed transactions and balance operations have been posted. In MetaTrader 5 terminology, it does not include the current profit or loss of positions that remain open. Those floating results affect equity instead, which is why balance and equity can differ while trades are active.
How does Balance work?
Balance represents the recorded funds in the account rather than the constantly changing value of open trades.
It may change after events such as:
a deposit or withdrawal;
a profitable or losing trade being closed;
a fee, commission, swap, credit or other applicable balance operation being posted.
The exact treatment of individual transactions depends on the trading platform and account conditions.
On MetaTrader 5, the account-state definition of balance excludes the results of currently open positions. Equity is shown separately and can include floating profit or loss.
This distinction means the balance can remain unchanged even while the market value of open positions moves significantly.
Key features of Balance
Several characteristics are important when interpreting trading balance:
It reflects posted account funds: Balance represents money recorded on the account after completed balance-affecting transactions.
Open positions are excluded: Current floating profit or loss from open positions is not included in MetaTrader 5's balance figure.
It differs from equity: Equity incorporates the current impact of open positions and other applicable account components.
It differs from free margin: Free margin is linked to equity and margin rather than balance alone. MetaTrader 5 defines free margin as equity minus margin, subject to account conditions.
It can be displayed over time: Trading reports may show a balance curve based on completed deals and account transactions.
Platform definitions can vary: Traders should use the terminology and calculations supplied by their specific trading platform and provider.
Simple Balance example
Suppose a trading account starts with:
Balance: $5,000
A trade is opened and currently shows an unrealised profit of:
+$300
Because the trade is still open:
Balance = $5,000
while, in a simplified example:
Equity = $5,000 + $300 = $5,300
If the trade is then closed with the $300 profit and there are no other adjustments:
New Balance = $5,300
The key point is that the floating result affects equity while the trade is open and becomes part of the recorded balance once the result is realised and posted.
This example is illustrative only. It excludes commissions, swaps, fees, credits and other adjustments and does not represent actual FxGrow account conditions.
Potential benefits and uses
Monitoring balance may help traders understand the realised financial history of an account.
It can be used to:
track the effect of closed trades;
monitor deposits and withdrawals;
review posted charges or credits;
compare realised account value with current equity;
reconcile account history and trading reports;
analyse balance drawdown based on completed transactions.
Balance is therefore useful for tracking realised account changes, but it does not provide a complete picture of current account risk while positions remain open.
Risks, limitations and common misconceptions
A common misconception is that balance represents the current value of the entire trading account.
That is not necessarily true.
If open positions have significant unrealised gains or losses, equity may be substantially higher or lower than balance. MetaTrader 5 explicitly distinguishes balance from equity for this reason.
Another misconception is that balance is the same as the amount available for opening new trades. It is not. Available trading capacity can depend on equity, margin, free margin and the applicable account conditions.
Balance should also not be treated as proof of profitability by itself. A trader could have a high recorded balance while holding large unrealised losses in open positions.
Finally, the term Balance is effectively the shorter platform label for what is often described more fully as Account Balance. To avoid unnecessary duplication in a glossary, “Balance” can focus on the platform field itself, while “Account Balance” can provide the broader account-level explanation.