Definition. The LTH Realized P/L Ratio is simply the ratio between the LTH Realized Profit and Realized Loss, plotted green while above 1.0 and red while below, with LTH-SOPR 🔵 overlaid for comparison and price in grey. It provides a view on macro trend, shifts in market sentiment, and the directional dominance of value flowing in/out of the network.

Technical. The ratio is smoothed with a 7-day EMA and split at the 1.0 equilibrium level:

• LTH Realized P/L Ratio = ema(LTH Realized Profit / LTH Realized Loss, 7) — green when >= 1, red when < 1

Both inputs are the entity-adjusted (account-based) realized profit and loss metrics. The overlay is the native LTH-SOPR metric.

Interpretation. The LTH Realized P/L Ratio can be used on both longer and shorter term timeframes and moving averages to provide insight into:

• Macro market trends whereby profit dominance is typical of uptrends 🟢, and loss dominance typical of downtrends 🔴.

• Breaks above/below 1.0 suggesting regime shifts signalling a potential shift in profit/loss dominance alongside market strength/weakness.

• Retests of 1.0 within an established trend signalling a market equilibrium and decision point is reached.

• 🔵 LTH-SOPR is also shown, providing a comparison Realized Profit/Loss multiple. SOPR does not consider total USD value, and instead works on a 'per-spent-output' basis. This means small and large size transactions carry equal weight (whereas the P/L Ratio is sensitive to size).

Notes. Realized P/L Ratio has a similar interpretation framework to the SOPR metric, with a detailed breakdown available on Glassnode Academy. The Short-Term Holder counterpart is Short-Term Holder Realized Profit / Loss Ratio, and a momentum view of this ratio is charted in LTH Realized P/L Ratio Momentum. Built from LTH Realized Profit, LTH Realized Loss and LTH-SOPR.