NOVA Max Drawdown Rule
The Max Drawdown defines the maximum loss an account can sustain before it is considered breached.
This rule applies differently during the:
Evaluation (Challenge) Stage
6%
Max Drawdown, Trailing
Funded Account Stage
5%
Max Drawdown, Trailing
Evaluation Stage Drawdown
| Rule | Condition |
|---|---|
| Max Drawdown | 6% |
| Drawdown Type | Trailing |
| Trailing Stops At | Starting Balance |
How Evaluation Drawdown Works
- The drawdown trails based on the highest balance (closed trades only)
- The drawdown moves upward as profits increase
- The drawdown locks once it reaches the starting balance
- If balance or equity touches the drawdown level, the account is breached.
Example — Evaluation Account
| Item | Amount |
|---|---|
| Starting balance | $100,000 |
| Max drawdown | 6% = $6,000 |
| Initial breach level | $94,000 |
If your balance rises to $103,000:
- New drawdown level = $97,000
If equity later drops to $97,000 → breach
If trailing reaches $100,000:
- Drawdown locks at starting balance
- It no longer trails upward
Funded Account Drawdown
| Rule | Condition |
|---|---|
| Max Drawdown | 5% |
| Drawdown Type | Trailing |
| Model | Lock at starting balance on 5% profit and after Payout |
How Funded Drawdown Works
- The drawdown trails as the account grows
- The drawdown trails based on the highest balance (closed trades only)
- After a payout, the drawdown locks based on LUP rules
- Both balance and equity are monitored
If balance or equity reaches the drawdown level → account breach
Example — Funded Account
| Item | Amount |
|---|---|
| Starting balance | $100,000 |
| Max drawdown | 5% = $5,000 |
| Initial breach level | $95,000 |
If balance rises to $110,000:
- Drawdown adjusts upward accordingly
If equity later drops to drawdown level → breach
Key Differences Between Evaluation & Funded
| Feature | Evaluation | Funded |
|---|---|---|
| Drawdown % | 6% | 5% |
| Type | Trailing | Trailing |
| Lock Behavior | Locks at starting balance | Lock at starting balance on 5% profit and after Payout |
| Resets | Unlimited free resets | Not applicable |