There is more to PnL versus ROI scoring in a trading competition than meets the eye. It is not some dry exercise in number crunching; it is what will put the prize in your pocket at the end of today’s most sought after crypto events. You may be a veteran of trading tournaments or simply want to put an edge on your game for the next BuyCrypt challenge, but you cannot afford to be in the dark on how these are scored if you have any intention of making the leaderboard, let alone the top of the prize pool. Here is a look at what lies behind the acronyms and why the style of play has to adapt to them.
I have had my share of traders come in with complaints of ranking confusion or feeling short-changed by a rogue PnL on the latest leaderboard. The truth is the scoring method is the rulebook for victory. Be it a tournament run on PnL or ROI in crypto, or the rather imposing lingo of the Portfolio Master Challenge (PMC), you need to know how the format can work in your favour — or explain why all your hard work didn’t show up where you expected.
In a PnL vs ROI contest, don’t be in a hurry to click. The calculation of your score will dictate which strategies are viable and which are not. One is about raw profit, the other percentage gain. Confusing the two is the surest way I see to watch a worthy trader get left out in the cold at the final count.
Profit and Loss is the traditional heart of scoring in crypto comps. But we can dispense with the jargon. Whether realised or unrealised, both have their place on the leaderboard.
What you would have if you put your position to rest right now, though the market can change that in a heartbeat. To be fair, most competitions will score on the realised side of things.
Take 2 BTC bought at $60,000 and sold for $62,000 with $100 in fees: ($62,000 – $60,000) × 2 – $100 gives you a PnL of $3,900. Tally up your closed trades and that is your contest PnL.
With Return on Investment, it is not only about the money made but what you put at risk to make it. In crypto, ROI can be the great equaliser for the smaller account, provided one is judicious with leverage and sizing.
(Net Profit / Starting Balance) × 100. A $1,000 balance turned into $1,300 is a 30% ROI. On paper it is straightforward, but leverage is a wild card; without knowing what you are doing, big moves can torch your ROI just as quickly.
A PnL comp tends to go to the whales or those with a larger starting stack. An ROI contest rewards the nimble trader with high conviction who can eke out a large percentage from a small sum. We have both at BuyCrypt, so be clear on the rules before you open a position.
The Portfolio Master Challenge is something else entirely. Consider it the decathlon of the crypto world. This multi-round, multi-metric affair will look at overall PnL or ROI, to be sure, but also at portfolio diversity, risk controls and compounding gains. You need more than one trick to win here.
Do yourself a favour and check the formula for the event so you are not taken aback by a rule you missed.
I have seen them scored by raw dollars, percentages or even activity over the years. All of it is part of the PnL vs ROI debate. The table below lays out the main formats and the key differences. Have a look before you decide on a course of action.
| Scoring Model | What Counts | Who Benefits | Risks / Catches |
|---|---|---|---|
| PnL-Based | Absolute dollar profit | The whales with high volume and large balances will run the show | Small accounts have a hard time making an impression |
| ROI-Based | Percent gain on the capital you put in | Risk takers and those using high leverage on small caps | “All-in” dangers and volatility; sometimes luck is the only thing that wins |
| Hybrid / Weighted | A combination of PnL, volume and percentage | Multi-skilled, balanced traders | Rules can be complex enough to cause strategy confusion |
| Volume-Weighted | How much you trade | Active, high-frequency types | Risk of overtrading and racking up fees |
I have been through my share of events on various platforms and I can tell you no two rulebooks are cut from the same cloth. On the surface the formula for scoring a leaderboard may appear straightforward, but once you factor in margin and leverage, the devil is in the details.
There was a case at a recent BuyCrypt comp where I saw a trader go from the top ten to the bottom five on the strength of one volatile candle. An unrealised loss wasn’t locked in and the drama was on. Meanwhile, a more conservative account made its way up the ranks. Their ROI model was kind to the patient type who let small gains compound day after day rather than hunt for glory. Take the hint: if you don’t know the rules you could well be the subject of next week’s cautionary tale in the chatroom.
| Exchange Example | Score Method | Leverage? | Notes |
|---|---|---|---|
| BuyCrypt* | ROI with daily compounding | Yes, in the tally | No do-overs on liquidations |
| Generic PnL Comp | Raw PnL (realised) | Optional, raises risk | Tally comes at the end of the contest |
*Do yourself a favour and check the tournament rules for the current event. Formats have a way of changing on short notice.
You will hear plenty of myths in crypto born of a failure to respect how leverage affects your ROI or the margin calculation. Make a play to go all-in during a bull run and you might look clever until you blow up in the first round. Then you can watch your PnL% tank while the prudent traders quietly pass you on the final day.
The usual suspects when it comes to PnL vs ROI:
Your tactics need to be in line with the rules. If it is a PnL comp, put your money on larger, high-probability trades. But if you are near the top, there is little point in being greedy and risking it all for one more bet. For an ROI comp, you can win by keeping losses tight and being judicious with leverage. Small and steady works, provided you can stomach the volatility and don’t feel the need to go for broke.
Consider two scenarios with a $2,000 starting position that ends at $2,900. In an ROI comp you have a 45% return ($900/$2,000). Now put that in a “most profit” PnL comp. Your raw number is $900. Another competitor starts with $10,000 and makes $1,500. His ROI is a paltry 15%, but he takes the win on PnL and you are left with nothing.
Any trading competition will see the scoring system dictate your fate more than you think, so don’t be tempted to aim for glory on every position. Read the fine print, manage your risk and leave the luck to someone else. If you have a question about the rankings before you enter your next BuyCrypt event, get in touch. We want to ensure your efforts are reflected on the winner’s list.
It is a matter of consistency: stick to one time frame, three strategies and five currency pairs.
Take the sell price less the buy price and any fees, then multiply by quantity.
Three confirmations and five filters to enter, with a cap of seven open trades for control.
PnL is for the total raw figure. ROI puts smaller balances on equal footing by looking at the percentage of your starting capital.
You will not find a sure-fire formula. The common denominator among most high earners is an aptitude for strong risk management and a firm grasp of the scoring format; they are also accustomed to handling sizeable capital and leverage. Make it a habit to familiarise yourself with the tournament rules before anything else.
