Understanding The Max Trailing Drawdown - 1-Step FLASH
The Max Trailing Drawdown acts as a safety net for your 1-Step Account. Here's how it works:
- Starting Off: When you begin trading, your account has a 7% trailing drawdown based on your starting balance.
- Growing Your Account: As you grow your account and make gains, the drawdown moves up with your closing balance until you achieve a 7% gain overall.
- Locking In: Once you reach a 7% gain, the drawdown locks at your starting balance and no longer trails with your account growth.
Example
$100,000 starting balance with a 7% drawdown
| Item | Amount |
|---|---|
| Starting balance | $100,000 |
| Drawdown | 7% |
| Your account would breach if the equity drops to | $93,000 |
- If your account grows to $105,000, your new drawdown level moves up to $98,000.
- If you continue growing your account to $107,000, the drawdown locks in at your starting balance of $100,000.
From this point on, no matter how much your account grows (even up to $170,000), you would only breach your account if your equity falls below $100,000.
Maximum daily loss rule
However, be mindful of the 4% maximum daily loss rule as well — [More Information here]