Summary
10% | Current equity or balance must not reach -10% relative to the initial account balance. This is fixed and does not trail higher when you’re in profit.
Example:
Initial Account Balance: $100,000
Max. Overall Loss: -$10,000
At any point during the evaluation, the current equity or balance must not drop to $90,000.
At FundingTraders, preserving trading capital is of utmost importance, and our Maximum Loss rule is designed to do just that. With a fixed maximum allowable loss of 10%, it is crucial to ensure that your current equity or balance does not fall below -10% relative to the initial account balance. For example, if your initial account balance is $100,000, the maximum overall loss is capped at -$10,000.
Throughout the evaluation period, it is essential to adhere to this rule diligently. At any point during your trading activities, make sure that your current equity does not drop to $90,000 or below. Unlike trailing mechanisms, our Maximum Loss rule remains constant and does not increase even if your trades are in profit.