Maximum Drawdown

Last Updated: October 16, 2026

Maximum Drawdown is the maximum loss permitted on your account. The applicable drawdown limit depends on your account type and is calculated according to its specific drawdown rules.

Maximum Drawdown Limits by Account Type

1 Step Standard: 6% Trailing Drawdown

2 Step Standard: 8% Trailing Drawdown

2 Step Pro: 8% Static Drawdown

Instant Funding: 5% Trailing Drawdown

How Does Trailing Drawdown Work?

For accounts with trailing drawdown, the drawdown threshold adjusts upward as your closed End-of-Day (EOD) balance reaches new highs. The threshold does not move downward when your balance decreases.

The threshold is calculated using your closed EOD balance and locks permanently at your initial starting balance once the designated profit level is reached. Floating profits during the trading day do not increase your trailing drawdown threshold.

Example – 2 Step Standard (8% Trailing Drawdown)

Initial Starting Balance: $100,000

Maximum Trailing Drawdown: 8% ($8,000)

Initial Drawdown Threshold: $92,000

If your account’s closed EOD balance reaches a new high, your drawdown threshold may move upward accordingly. However, it will never move downward. Once the threshold reaches the initial starting balance of $100,000, it locks at that level.

How Does Static Drawdown Work?

For accounts with static drawdown, the drawdown threshold is calculated from your initial starting balance and remains fixed, regardless of how much profit your account generates.

Example – 2 Step Pro (8% Static Drawdown)

Initial Starting Balance: $100,000

Maximum Static Drawdown: 8% ($8,000)

Fixed Drawdown Threshold: $92,000

Your account will be breached if your balance or equity falls below the $92,000 threshold. Even if your account balance grows to $110,000, the drawdown threshold remains fixed at $92,000.

Important Rules to Remember

Trailing drawdown thresholds are based on closed End-of-Day (EOD) balances. Floating intraday profits do not raise the trailing drawdown threshold. Static drawdown thresholds remain fixed at the level calculated from the initial starting balance. Breaching the applicable Maximum Drawdown limit will result in an account breach.

Always monitor your balance and equity to ensure they remain within your account’s permitted drawdown limits.