How is the 5% daily drawdown calculated?

During the verification phases, the 5/4% is calculated based on your initial funded account capital. For example, if your funded account is $50,000, the total daily drawdown for all trades would be $2,500/2,000. It’s important to note that this amount remains constant and does not change from day to day. When calculating the drawdown, all floating losses, profits, and fees are included. The system collects and calculates daily drawdown multiple times over a day. The daily server reset occurs at UTC.

The standard daily drawdown is trailing, as it is calculated from the highest equity point reached during the day, including unrealized P&L.

The swing daily drawdown, which is available as an upgrade option after selecting your platform, is static and calculated from the day’s starting equity.

Trailing Daily Drawdown

Equation

Daily Drawdown = Peak Value of the Day − Lowest Equity Point After Peak (includes unrealized P&L)

Two-Step Challenge

Account size: $5,000

Daily limit: 5% ($250)

Peak equity: $5,200

Lowest equity: $4,950

Calculation

$5,200 − $4,950 = $250

If equity reaches or falls below $4,950, the rule is breached.

One-Step Challenge

Account size: $5,000

Daily limit: 4% ($200)

Peak equity: $5,200

Lowest equity: $5,000

Calculation

$5,200 − $5,000 = $200

If equity reaches or falls below $5,000, the rule is breached.

Swing Daily Drawdown

Equation

Daily Drawdown = Starting Equity of the Day − (Initial Account Balance × Drawdown %)

Two-Step Challenge

Account size: $5,000

Daily limit: 5% ($250)

Starting equity: $4,900

Calculation

$4,900 − $250 = $4,650

If equity reaches or falls below $4,650, the rule is breached.

One-Step Challenge

Account size: $5,000

Daily limit: 4% ($200)

Starting equity: $4,900

Calculation

$4,900 − $200 = $4,700

If equity reaches or falls below $4,700, the rule is breached