Profit and Loss (P&L)

Profit and loss measures the financial result of positions or account activity over a stated scope, separating open valuation changes from completed results.

P&L can be shown per position, instrument, day, or reporting period, and should state whether fees, financing, income, and currency conversion are included. Unrealized P&L changes with the valuation price, while realized P&L is recorded when exposure is closed or otherwise settled. P&L is not the same as cash flow, total return, account balance, or taxable gain, so reports should be reconciled to ledger entries and methodology.