Now that we have already covered Balance, it is vital to understand what Equity is. In trading, equity refers to the amount of money a trader has in their trading account (the Balance) plus or minus any profit or loss from open positions. Many traders confuse these two amounts. Remember that Equity in forex refers to your balance plus any profit or loss from open positions. But in case you do not have any open positions, then your Balance equals your Equity. The Equity amount is displayed in the Terminal window right under the Trade tab on your MT4 Client Terminal. If you are using the MT5 trading platform, then the Equity amount is located in the Toolbox under the trade tab. That is the simple difference between Balance and Equity when it comes to trading.

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