Understanding Soft Breaches in Instant Funding Accounts
In Instant Funding Accounts, there are specific rules designed to promote disciplined trading and protect both the trader and firm capital. One key aspect of this is the soft breach system. A soft breach occurs when certain minor rules are violated, and while this doesn’t result in account termination, there is a soft breach limit of 10 breaches for Instant Funding accounts.
What is a Soft Breach?
A soft breach is a minor violation of the trading rules. When a soft breach occurs, the trade or trades that violated the rule will be automatically closed, but your account remains open, allowing you to continue trading. However, in Instant Funding Accounts, you are limited to a total of 10 soft breaches. Exceeding this limit may lead to a hard breach on your account.
Soft Breach Violations for Instant Funding Accounts:
Here are the main scenarios where a soft breach can occur in an Instant Funding account:
No Stop Loss on Trades:
Entering a trade without an active Stop Loss will result in a soft breach. The trade will be automatically closed to protect your account.Exceeding the Loss Limit on Individual Symbols (Equity Shield):
If your floating drawdown on any one symbol exceeds 2%, EquityShield will step in to protect your account by closing all trades for that symbol, leading to a soft breach.Exceeding the Loss Limit Across All Symbols (Equity Shield):
If your combined floating drawdown across all open trades exceeds 2.5%, EquityShield will automatically close all open trades, resulting in a soft breach.Exceeding Max Lot Size:
Instant Funding accounts have a max lot size limit based on your account size. If your total lot size exceeds this limit, all open trades will be closed automatically, triggering a soft breach.
Why the 10 Soft Breach Limit?
The 10 soft breach limit is in place to ensure traders remain disciplined and follow the rules closely. While soft breaches allow you to continue trading after minor violations, reaching the limit indicates repeated rule violations, which compromises both your account and the firm’s capital. This system encourages responsible trading and risk management.
Conclusion:
In Instant Funding Accounts, staying within the rules is key to long-term success. While soft breaches offer flexibility for minor violations, there is a limit of 10 soft breaches. After this point, further breaches could lead to a termination of your account. Understanding the soft breach rules and ensuring you follow them will help you protect your account and continue trading successfully.
If you have any questions or need further clarification about the soft breach system, feel free to contact our support team.