What is the Portfolio Performance feature?
The Portfolio Performance feature allows customers to see how their crypto is doing on Coinbase.com without extra mental math or spreadsheets. To track the performance of your crypto portfolio on Coinbase.com, customers can utilize 2 metrics: gain/loss and return.
Gain/loss is an estimate of your earnings on Coinbase.com over a specific period of time. It includes both potential gains from your Coinbase portfolio changing in value, as well as realized gains from sells over the time period selected in the portfolio chart. The gain/loss metric only accounts for activity on Coinbase.com.
Note: This metric does not reflect the gains or losses for taxes, which may be different. Coinbase does not provide tax advice. To calculate your tax obligation, please consult a tax advisor.
The gain/loss metric is relative to the fiat-invested cost to acquire that specific crypto on Coinbase. In order to determine gain/loss, Coinbase estimates the original fiat value of crypto purchased on-platform using the first-in-first-out method.
Coinbase uses time-weighted returns for your portfolio, which is a common way investors see a return communicated. Time-weighted returns are useful for understanding the aggregate effect of price changes from all of the cryptos that make up your portfolio over a specific time period.
How are these metrics calculated?
Here are a few sample actions and how they affect gain/loss:
- Buy: Your gain/loss does not change, aside from any fees
- Sell: Your gain/loss changes based on the difference between the market value of what you sold and the fiat-invested cost
- Rewards: Your gain/loss increases by the market value of the crypto you received
- Crypto Conversions: Crypto conversions act as a sell of the first crypto in the pair and a buy of the second crypto in the pair. The first crypto in the conversion pair is treated as a sell. The gain/loss changes are based this sell.
- Crypto Receives: Your gain/loss increases by the market value of the crypto you received at the time it was received
- Crypto Sends: Your gain/loss decreases based on the difference between the crypto price at the time of send and the fiat-invested cost
A number of assumptions go into the fiat-invested cost metric, especially for customers who send and receive crypto off-platform. Here are a few sample actions and how they affect fiat-invested cost:
- Deposit: The fiat-invested cost goes up by the amount of fiat you deposit from your bank or card
- Withdrawal: The fiat-invested cost goes down by the amount of fiat you withdraw to your bank or card
- Buy: If crypto is purchased using funds from your bank or card, the fiat-invested cost goes up by the market value of the crypto you purchased at the time of purchase
- Sell: The fiat-invested cost does not change since assets are sold to your Coinbase fiat wallet
- Receive: Treated as $0 fiat-invested cost
- Send: The fiat-invested cost goes down using the first-in-first-out cost method
- Rewards/Earn: Treated as $0 fiat-invested cost
Time-weighted returns are a measure of price changes without inflows and outflows, which includes sends, receives, deposits, and withdrawals (see investopedia for calculation examples).
Should I use gain/loss, fiat-invested cost, returns and for tax purposes?
No. Coinbase does not give tax advice. You should not use these metrics as a substitute for calculating taxes. These metrics are estimates and can fluctuate frequently. Please consult a tax advisor.
Why is my gain/loss positive and return negative (or vice versa)?
The Gain/loss and Return metric are not mutually exclusive. Returns only looks at price changes within the time period filtered while gain/loss accounts for activity beyond the time period filtered in the chart. One can have a positive gain/loss from making a gain from selling crypto, yet see the time-weighted return be negative for that time period.
Why am I not seeing my Coinbase Pro balances?
This feature does not take into account your balances and transactions on Coinbase Pro.