What Is Profit & Loss (PnL)?

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.

**To learn more about this concept and become a master at Prop Trading Interviews, you should check out our Prop Trading Interview Course. Learn more here.** 

Learn More Here

Related Terms

Return to Finance Dictionary

 

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.

 

Prop Trading Interview Course

 

 

 

 

Start Discussion

Total Avg Compensation

April 2021 Investment Banking

  • Director/MD (9) $911
  • Vice President (32) $350
  • Associates (180) $232
  • 2nd Year Analyst (102) $151
  • 3rd+ Year Analyst (25) $146
  • Intern/Summer Associate (95) $145
  • 1st Year Analyst (387) $131
  • Intern/Summer Analyst (315) $82