Profit-and-Loss Calculator
Use our free profit-and-loss calculator to calculate stop-loss and take-profit levels.
What is Profit-and-Loss?
Profit-and-loss, or P&L, is a term used by traders and investors to describe the difference between the amount of profit a position earned and the position cost.
For example, if a trader buys a stock for $100, sold it for $110, and commissions were $5, then the P&L for the trade is $5. This is because the $110 - $100 - $5 = $5 profit.
P&L and Money Management
Managing P&L is an important part of money management. One way to manage your trades and improve your P&L is by using stop-loss and take-profit targets.
By using a stop-loss order, traders mitigate risk by setting a fixed amount of money they are willing to lose per trade. Similarly, with a take-profit sell or limit order, a trader is able to set profit targets that determine the potential profit per trade.
Without a positive P&L metric, a trader cannot be a consistently profitable trader. Therefore, traders need to keep their P&L as high as possible by using money management techniques that include: using stop-losses, take-profit targets, and optimal position sizing.
