A trader refers to his trade as Flat when he has held the position for a length of time yet has chosen to close it out due to non-profit.
While the trade has essentially not been closed out at a loss, it has sat on his books without producing a gain large enough to justify the holding period. While a Flat trade has no loss, the trader has still committed capital to the trade and therefore a certain risk has been taken. Since trading is measured risk taking, a Flat trade is often considered to be a Flat on a Failure trade, because successful traders expect a certain percentage unit of return for each unit of risk in a trade. The Flat trade is essentially a failure because capital was at risk without adequate return.