Definition of the word pt

The abbreviation "PT" stands for "proprietary trading" in the context of finance and investment. It refers to the trading activities carried out by licensed financial firms or designated individuals within those firms for their own account and investment purposes, rather than on behalf of clients. This long-established practice, which has its roots in Wall Street, gained additional prominence following the US Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which instituted new regulatory restrictions on traditional commercial banking entities' ability to engage in proprietary trading. In response, many such banks spun off their PT desks into separate proprietary trading firms (PTFs) legally structured as hedge funds in order to continue these operations. Today, the PT designation is commonly employed across global financial markets, ranging from equities and fixed income to foreign exchange and commodities.