<p>As explained by <a href="http://www.investopedia.com/terms/p/profit.asp" rel="nofollow">http://www.investopedia.com/terms/p/profit.asp</a>:</p>

<blockquote>
  <p>profit = total revenue - total expenses</p>
</blockquote>

<p>or in plain English:</p>

<pre><code>profit = (what you had received after selling all your coins) - (what you had paid to buy your coins)
</code></pre>

<p>so, for example:</p>

<p>If you had spent $1000 for Bitcoin priced at $500/BTC on exchange A, and say the fee is 1%, you will received</p>

<pre><code>$1000/$500*(1-0.01) = 1.98 BTC
</code></pre>

<p>If you move and sell your 1.98 BTC at for $600/BTC on exchange B, which also charges a 1% fee, you will receive</p>

<pre><code>1.98*$600*(1-0.01) = $1176.12
</code></pre>

<p>So your profit will be</p>

<pre><code>$1176.12 - $1000 = $176.12
</code></pre>

<p>Remember to also subtract any withdrawal/deposit fees if applicable.</p>

CC BY-SA 3.0
2014-07-04T09:39:55.367Z
2014-07-07T07:42:20.757Z
2014-07-07T07:42:20.757Z
Jasper Citi
<p>Found the formula in the following <a href="https://bitcoin.stackexchange.com/questions/1121/costing-arbitrage-between-exchanges">link</a>. I can't understand with my knowledge. Can anybody explain me with an example? </p>

<pre><code>profit = ExchangeA_sell * (1 - ExchangeA_fee) - ExchangeB_buy * (1 + ExchangeB_fee).
</code></pre>

<p>One more thing, Is this formula good for all exchanges? Cryptsy and Bter have calculated differently their net total. Bter sell offer is different from cryptsy sell offer. In Bter the trade fee is deducted just opposite to cryptsy in terms of buy and sell currency?</p>

CC BY-SA 3.0
2014-07-01T13:48:18.623Z
I explained it in more detail [here](http://bitcoin.stackexchange.com/questions/25754/how-the-arbitrage-works/25762#25762). Maybe it is more clarifying
Mathias711
CC BY-SA 3.0
2014-07-01T14:02:59.890Z
I'm not quite sure what you mean in the other questions. The net total does not matter at all for arbitrage. And what in the sell offer is different? The offers itself are of course different, because it are different exchanges. I tried to explain something similiar as your last question [here](http://bitcoin.stackexchange.com/questions/26996/sell-order-in-bter-is-incorrect/26997#26997). But please rephrase
Mathias711
CC BY-SA 3.0
2014-07-02T09:11:41.030Z
@Mathias711 - http://bitcoin.stackexchange.com/questions/28263/calculation-of-arbitrage-profit. This is my problem. I am stuck at here.
Jsd
CC BY-SA 3.0
2014-07-02T09:12:44.590Z
I saw the question, I tried to read it, but important stuff came through. I will comment my first idea of it
Mathias711
<exchanges><arbitrage>
Can't understand arbitrage profit calculation
Jsd
# Can't understand arbitrage profit calculation

(Asked by: username_0 on 2014-07-01)

Found the formula in the following [link](https://bitcoin.stackexchange.com/questions/1121/costing-arbitrage-between-exchanges). I can't understand with my knowledge. Can anybody explain me with an example?

```
profit = ExchangeA_sell * (1 - ExchangeA_fee) - ExchangeB_buy * (1 + ExchangeB_fee).

```

One more thing, Is this formula good for all exchanges? Cryptsy and Bter have calculated differently their net total. Bter sell offer is different from cryptsy sell offer. In Bter the trade fee is deducted just opposite to cryptsy in terms of buy and sell currency?

**Tags:** exchanges, arbitrage

> **Comments:**
> **username_1**: I explained it in more detail [here](http://bitcoin.stackexchange.com/questions/25754/how-the-arbitrage-works/25762#25762). Maybe it is more clarifying  
> **username_1**: I'm not quite sure what you mean in the other questions. The net total does not matter at all for arbitrage. And what in the sell offer is different? The offers itself are of course different, because it are different exchanges. I tried to explain something similiar as your last question [here](http://bitcoin.stackexchange.com/questions/26996/sell-order-in-bter-is-incorrect/26997#26997). But please rephrase  
> **username_0**: @username_1 - http://bitcoin.stackexchange.com/questions/28263/calculation-of-arbitrage-profit. This is my problem. I am stuck at here.  
> **username_1**: I saw the question, I tried to read it, but important stuff came through. I will comment my first idea of it  

---

## 1 answers

### Answer by username_2 on 2014-07-04. Score: 1

As explained by <http://www.investopedia.com/terms/p/profit.asp>:

> profit = total revenue - total expenses

or in plain English:

```
profit = (what you had received after selling all your coins) - (what you had paid to buy your coins)

```

so, for example:

If you had spent $1000 for Bitcoin priced at $500/BTC on exchange A, and say the fee is 1%, you will received

```
$1000/$500*(1-0.01) = 1.98 BTC

```

If you move and sell your 1.98 BTC at for $600/BTC on exchange B, which also charges a 1% fee, you will receive

```
1.98*$600*(1-0.01) = $1176.12

```

So your profit will be

```
$1176.12 - $1000 = $176.12

```

Remember to also subtract any withdrawal/deposit fees if applicable.


---

