static
The Maximum Loss Limit is the total amount your account equity or balance is not allowed to reach. It is calculated from your initial account size and remains static
Example: On a $100,000 account, your equity or balance cannot hit or fall below $94,000 at any point. Even if your account grows to $120,000, the maximum loss floor remains at $94,000.
At most prop trading firms that adopt static, when your first payout is processed, the Static Drawdown loss level moves up to your initial balance and stays there permanently.
Trailing
Max Drawdown 5% trailing
This is a trailing drawdown that adjusts upwards as your balance grows — but only up to your initial starting balance. Once it reaches your starting balance, it locks and does not move further.
Example:
- 1st Trade：You make $200 profit; Max drawdown = $10,200 – $500 = $9,700
- 2nd Trade: You lose $100; Max drawdown stays at $9,700, since your equity didn’t exceed the previous high of $10,200
- Day 3: You make $500 profit; Max drawdown = $10,600 – $500 = $11,000; Max Drawdown locks at $10,000
- Floating Equity Example – Case 2 (Day 3): Profit Ignored, Breach on Close
- You’re at $9,800, open a strong trade, and equity spikes to $10,600
- Max Drawdown locks at $10,000
- But you only close with a $100 profit, ending at $9,900
- You immediately breach the Max Drawdown rule, because you closed below the locked $10,000 level
- Learn when to take profits — if your equity moves far enough to trigger a lock, but you don’t close while you’re ahead, you risk breaching simply by closing too late.
At most prop trading firms that adopt static, when your payout is processed, trailing drawdown doesn’t reset
But AIFO: when your payout is processed, trailing drawdown will reset
- Refer to Day 3: Your Max Drawdown locks at $10,000
- After your payout is processed, your Max Drawdown is reset to $9,500
