Profit and Loss (or PnL) is a common term used in trading and is extremely self-explanatory. It simply refers to the total profit or loss made by an individual or group over a certain time period.
P&L Definition and Example
For example, an individual trader may have a daily PnL limit such as +/- $50,000 meaning the maximum amount he will aim to make s $50,000 and if he loses $50,000 he will stop trading for that day.
Often times traders will receive a percentage of their P&L as a commission for making money for the firm. You can see an example of a P&L in spreadsheet form below.
Want a Career in Trading?
To begin preparing for your interview, WSO Prop Trading has everything you need to know for prop trading interviews, including a myriad of questions with thoroughly explained answers.