The maximum daily drawdown of 5% is initially based on your account’s opening balance at the reset time, before any trades are executed.
This is reset each day at 12:00 PM market observation time.
Second, this metric is also calculated by the highest equity point.
Make sure you don’t go 5% below the opening balance at the reset time, or 5% below the highest equity point in a day.
Below is the counting formula our system uses to determine drawdown amounts.
Counting formula:
Maximum balance or equity for the day (whichever is greater) – current equity.
The total maximum drawdown of 8% or 10% is also a metric that tracks account balance and equity.
Example: If you start with a $100,000 account, your maximum loss level will be set at $92,000 or $90,000. If your account balance or equity reaches $108,000 or $110,000, your drawdown meter will be set at $100,000. The final drawdown will always be 8% or 10% less than the highest balance or equity.
It is at the trader’s discretion to manage risk according to these rules when trading with our funded accounts. Violation of these risk reduction rules will result in the loss of the funded account.
Each trader will have access to their maximum daily and total drawdown levels on their dashboard at all times. While monitoring your balance is important during the “experienced trader” stage, it’s also important to ensure your capital fluctuations don’t reach a difference of 5% in one day, or a difference of 8% or 10% overall.