With Model 3 you are opted to choose between Best Day rule or Profit cap, depending on which one suits your trading style the best.
Best Day Rule explanation:
With a 20% best-day rule, you must ensure that no single trading day exceeds more than 20% of your total generated profits. This feature was introduced to reward consistency, and discipline, and promote responsible trading behavior, which can be beneficial for E8 Traders and E8 Markets in the long run. It is also one of 2 consistency rules you can select from on the Model 3 account.
Your profit should not exceed 20% of the total profit target in one single day, otherwise, the profit target is increased by the amount you made extra. Ideally, you want to make 20 % of the profit target each day.
In case your profit target is $3,000, your ideal profit to make is $600 per day ( 20 % of your profit target). However if one of your best days is $1,000, your profit target is increased to $5,000 USD (Best day amount / 0.2 (best day rule (20 %))
In this example, it is $1,000 / 0.2 = $5,000
Example Scenario number 1:
Day 1 - $ 600 profit
Day 2 - $ 800 profit
Day 3 - $ - 400 loss
Day 4 - $ 600 profit
Day 5 - $ - 100 loss
Day 6- $ 1000 profit
Day 7- $ 600 profit
Total generated profit: $3,100
20% of the total generate profits: $620
Best day: $1,000
New profit target: $5,000
Since 20% of the total generated profit is $620 and your best day is $1,000 you won't be able to finish the profit target and keep trading until 20 % of the total generated profit is higher than your best day.
Also, the profit target has now increased to $5,000 which means that the $3,100 total generated profit is not enough, so you need to continue until you reach $5,000.
Example Scenario number 2:
Day 1 - $ 500 profit
Day 2 - $ 550 profit
Day 3 - $ - 50 loss
Day 4 - $ 600 profit
Day 5- $ 400 profit
Day 6- $ 550 profit
Day 7- $ 500 profit
Total generated profit: $3,050
20% of the total generate profits: $610
Best day: $600
Profit target: $3,000
Since 20% of the total generated profit is $610 and there is no single day that this profit is exceeded, you would be able to pass the phase of your evaluation.