The Max Trailing Drawdown acts as a safety net for your Instant Funding Account. Here’s how it works:
Starting Off:
When you begin trading, your account has a 6% trailing drawdown based on your starting balance.
Growing Your Account:
As your account grows and you make gains, the trailing drawdown moves up with your closing balance until you achieve a total 6% gain.
Locking In:
Once you achieve a 6% gain, the trailing drawdown locks in at your starting balance and no longer trails as your account grows.
Example:
Let’s say you start with $10,000. With a 6% drawdown, your account would breach if the equity falls below $9,400.
If your account grows to $10,500, your new drawdown level moves up to $9,900.
(Calculation: $10,500 - $600 = $9,900)If you continue growing your account to $10,600, the drawdown locks in at your starting balance of $10,000.
From this point on, no matter how much your account grows (even up to $15,000), you would only breach your account by max drawdown if your equity falls below $10,000.