> ## Documentation Index
> Fetch the complete documentation index at: https://docs.orbscan.com/llms.txt
> Use this file to discover all available pages before exploring further.

# PnL and Performance Metrics for Polymarket Traders

> Learn how Orbscan computes realized PnL, win rate, Sharpe ratio, and max drawdown for Polymarket traders from raw on-chain activity data.

Orbscan computes a suite of performance metrics for every Polymarket trader, derived entirely from on-chain data recorded on the Polygon network. Because every trade, redemption, and payout is auditable on-chain, the calculations are transparent and tamper-proof — you can verify any figure against the raw blockchain events yourself. These metrics help you evaluate trader quality, compare strategies, and understand the risk profile behind any wallet's track record.

## PnL: Profit and Loss

PnL measures the net money a trader has made or lost across their Polymarket activity. Orbscan denominates all PnL figures in **USD (USDC)**, since Polymarket settles entirely in USDC on Polygon.

### Realized PnL

Realized PnL covers positions that have already been closed — either by selling shares before resolution, or by redeeming a payout after a market resolves. This is money definitively made or lost.

```text theme={null}
realized_pnl = sale_proceeds - cost_basis
```

For a Redeem, `sale_proceeds` equals `quantity × $1.00` (since every winning share redeems at 100¢). For a Sell, `sale_proceeds` equals `quantity × sale_price`.

### Unrealized PnL

Unrealized PnL covers positions that are still open. It reflects the gain or loss you would lock in if you sold your current shares at today's market price.

```text theme={null}
unrealized_pnl = current_market_value - cost_basis
```

### Total PnL

Total PnL combines both components:

```text theme={null}
total_pnl = realized_pnl + unrealized_pnl
```

## Prices Are in Cents

All `price` values in Orbscan are expressed in **cents (¢)**, ranging from 0 to 100 — not dollars. This is a critical detail when calculating trade values yourself.

* A `price` of `78` means **78¢ per share**.
* Buying `100` shares at a price of `78` costs \*\*$78 USDC** (100 × $0.78).
* If that market resolves Yes, those 100 shares redeem for **$100 USDC** — a profit of **$22**.

The `grossValue` field reflects this calculation: `grossValue = (price / 100) × quantity`. A buy of 5 shares at 78¢ produces `grossValue = 3.9` (i.e., \$3.90).

## grossValue vs transferNetAmount

These two fields both measure value in USDC, but they capture different things:

| Field               | Formula                    | What It Represents                                                                                                                                                                             |
| ------------------- | -------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |
| `grossValue`        | `(price / 100) × quantity` | The theoretical value of the shares traded, based on price and quantity alone.                                                                                                                 |
| `transferNetAmount` | Actual USDC moved ± fees   | The real USDC that changed hands in the transaction, after the platform fee is applied. Positive = USDC sent out of the wallet (buy); negative = USDC received by the wallet (sell or redeem). |

For a Buy of 5 shares at 78¢:

* `grossValue` = **\$3.90** — the theoretical share value at the quoted price (`78/100 × 5`)
* `transferNetAmount` = **\$5.00** — the net USDC that moved out of the wallet in this transaction

The difference between `transferNetAmount` and `grossValue` can reflect order-book spread, fees, or multi-fill aggregation within a single transaction. For a Redeem, `transferNetAmount` is negative (USDC is received by the wallet) and its absolute value equals `quantity × 1.00`.

## Platform Fees

The `fee` field on every activity record is the **platform fee** deducted from the trade value, denominated in USDC. Fees apply to Buy and Sell actions; Redeems always have `fee = 0`.

```json theme={null}
{
  "action": "Buy",
  "price": 78.0,
  "quantity": 5.0,
  "fee": 0.02574,
  "grossValue": 3.9,
  "transferNetAmount": 5.0
}
```

Fees are deducted by the Polymarket protocol at the time of the trade. Orbscan surfaces the raw fee amount so you can accurately reconstruct cost basis and compare net vs. gross performance.

## Performance Metrics Summary

The metrics below are computed by Orbscan from the raw on-chain trade data returned by the activity endpoint (`GET /v1/trader/{address}/activity`). They are displayed on trader profile pages at [orbscan.com](https://orbscan.com) and are **not returned as fields in the Open API response** — the API returns individual trade records, and these analytics are derived from those records.

<Note>
  If you are building your own analytics, you can derive all of these metrics by fetching the full activity history for a wallet and applying the formulas described on this page.
</Note>

| Metric       | Derived From                    | Definition                                                  | Time Window |
| ------------ | ------------------------------- | ----------------------------------------------------------- | ----------- |
| Total PnL    | Activity records (all)          | `realized_pnl + unrealized_pnl` across all activity         | All-time    |
| 30-Day PnL   | Activity records (last 30 days) | Rolling PnL for trades opened or closed in the past 30 days | 30 days     |
| Win Rate     | Resolved activity records       | `(resolved_wins / total_resolved_markets) × 100`            | All-time    |
| Sharpe Ratio | PnL time series                 | `mean_return / std_deviation_of_returns`                    | All-time    |
| Max Drawdown | PnL time series                 | Largest peak-to-trough decline in cumulative PnL            | All-time    |

## Win Rate

Win rate measures how consistently a trader picks the correct outcome across resolved markets:

```text theme={null}
win_rate = (resolved_wins / total_resolved_markets) × 100
```

A **win** is counted when the trader held shares of the outcome declared correct at resolution — regardless of position size or entry price. Win rate is a consistency signal, not a profit signal. A trader with a 90% win rate who always bets small on high-probability outcomes may generate less dollar PnL than a trader with a 60% win rate who sizes up on high-conviction calls. Always read win rate alongside total PnL and Sharpe ratio for a complete picture.

## Sharpe Ratio

The Sharpe ratio is a **risk-adjusted return** metric. It rewards consistent gains and penalizes large swings in performance, even if those swings are ultimately positive.

```text theme={null}
sharpe_ratio = mean_return / standard_deviation_of_returns
```

Use the following benchmarks when evaluating traders on Polymarket:

| Sharpe Ratio | Interpretation                                           |
| ------------ | -------------------------------------------------------- |
| Below 0      | Negative risk-adjusted performance                       |
| 0 – 0.5      | Marginal — returns don't compensate for volatility       |
| 0.5 – 1.0    | Good — solid, consistent performance                     |
| Above 1.0    | Excellent — strong outperformance relative to risk taken |

In prediction markets, a Sharpe ratio of **0.5 or above** is generally considered good, given the inherently binary and high-variance nature of individual market outcomes.

## Max Drawdown

Max drawdown captures the **largest peak-to-trough decline** in a trader's cumulative PnL over their history. It answers the question: "What is the worst losing streak this trader has experienced?"

```text theme={null}
max_drawdown = max(peak_cumulative_pnl - subsequent_trough_pnl)
```

A low max drawdown relative to total PnL indicates that a trader grows their balance steadily without large reversals. A high max drawdown — even paired with strong total PnL — suggests the trader took on significant risk at some point and may do so again.

<Note>
  Orbscan updates all performance metrics in near real time as new on-chain events are indexed. PnL, win rate, and position values refresh continuously with each new Polygon block. Under normal network conditions, metrics are never stale by more than a few minutes.
</Note>