The Lightning Plan ensures both traders and the firm maintain a balanced approach to capital management. Here’s a breakdown of how the Lock Upon Payout works and its implications.
What is the Lock Upon Payout?
When you request a payout, your maximum trailing drawdown will lock at your starting balance. Once this lock is in place, the drawdown no longer trails your account growth, providing a fixed risk level for the remainder of your trading.
Example of Lock Upon Payout
Let’s explore how this rule applies in practical terms:
Starting Balance: $100,000
Account Growth: $110,000
If you request a $5,000 withdrawal, your maximum drawdown locks at $100,000, leaving you with $5,000 of drawdown room ($105,000 account balance).
If you request a $9,500 withdrawal, your account balance adjusts to $100,500. With the drawdown locked at $100,000, you now have only $500 of drawdown room before breaching your account.
How can I handle the Lock Upon Payout?
Instead of withdrawing the full amount of your gains, consider leaving some in your account as a buffer. This will give you more breathing room and reduce the risk of breaching your account.
Another option is to grow your account by an additional 5-10% before taking your withdrawal. This will give you a larger cushion and increase the likelihood of growing and compounding your account.
Of course, the decision is ultimately yours. We are more than happy to process your withdrawal, but our goal is to see you have many successful payouts with us in the future. We don't want you to jeopardize your account in any way.
Key Takeaways
Fixed Drawdown Post-Payout: Once a payout is requested, the trailing drawdown locks at the starting balance and no longer adjusts with account growth.
Manage Withdrawals Carefully: Traders should plan payouts strategically, considering how much drawdown room will remain after a withdrawal.
Focus on Long-Term Growth: The Lock Upon Payout rule encourages disciplined trading, leading to potentially larger payouts over time.
Important Notes
The lock upon payout is only applicable to 1-step flash, 1-step lightning and instant funded accounts.
2-step pro accounts do NOT have the Lock Upon Payout feature.
Conclusion
The Lock Upon Payout feature is a cornerstone of the Lightning Plan’s risk management system. By locking the trailing drawdown at the starting balance after a payout, it ensures stability for both traders and the firm. Understanding and adhering to this rule can help you maximize your trading potential and achieve consistent, long-term success. If you have questions or need assistance, feel free to contact our support team.