Help CenterThe Maximum Daily Loss Rule (also called the Maximum Daily Drawdown) is designed to prevent traders from losing more than a set percentage of their initial daily equity.
Applicable Limits by Account Type:
| Account Type | Standard Limit | With Add-On (20/10 Drawdowns) |
|---|---|---|
| Regular Challenge | 5% | 10% |
| Rapid Challenge | 5% | 10% |
| Instant Account | 3% | — |
This rule automatically adjusts throughout the trading day. As equity grows, the drawdown limit moves upward accordingly, ensuring the loss threshold scales with account performance.
🚨 If this rule is breached, the account will be closed immediately.
Understanding how this mechanism works is essential for risk control and account safety.
How do I calculate the Maximum Daily Loss?
Based on the Initial Equity of the Day
At 00:00 (server time), the system records your account’s initial equity.
The maximum daily loss is calculated as a percentage below that value:
-
- Regular/Rapid Challenge: 5% (or 10% with Add-On)
- Instant Account: 3%
Based on Equity Growth During the Day
Throughout the trading day (before the next 00:00 server time reset), the system continuously monitors your high-water mark.
Whenever a new high-water mark is recorded, the maximum daily loss level “trails” upward by the same amount. This adjustment happens in real time, ensuring that the daily drawdown threshold always aligns with equity growth.
It is important to note that the account balance and maximum daily loss reset to their default levels after a reward.
Scenario Exmaples:
✅Scenario 1 — No Breach
- Initial equity (Regular Challenge): $100,000
- Daily loss limit: $95,000 (5%)
The trader gains +2% ($2,000), raising equity to $102,000.
A new high-water mark is set, so the daily loss limit trails up to $97,000 ($95,000 + $2,000).
Later, the position turns negative and closes at $97,410 (a -4.5% drop from the high).
✅ No rule breach, as equity never falls below $97,000.
❌Scenario 2 — Breach
- Initial equity (Regular Challenge): $100,000
- Daily loss limit: $95,000 (5%)
The trader gains +2% ($2,000), raising equity to $102,000.
The new daily loss limit trails up to $97,000.
Later, the trader loses trades and equity drops to $96,951, which is below $97,000.
🚫 Rule breached, even though the drop from initial equity (-3%) seems small.
The violation occurs because the account hit the adjusted daily loss threshold.