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What's the difference between a Loss Limit and a trailing Drawdown Limit?

How Bankroll U's Loss Limit compares to a trailing drawdown limit

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Written by RJ Heller

Bankroll U uses a Loss Limit instead of a trailing Drawdown Limit. Here's the difference and what it means for you.
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What's the difference?

A trailing Drawdown Limit is measured from your account's highest-ever balance (its peak). Some platforms fail an account once it dips a set percentage below that peak, even if the account is still profitable overall.
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Bankroll U's Loss Limit is measured from where your account started, not its peak. You can lose up to 100% of your Initial Account Size in a level before your Bankroll is closed — for example, on a $1,000 Bankroll, you can lose up to $1,000 total, no matter how high your balance climbed along the way.
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Example: an early loss

You start with a $1,000 Bankroll and net a $100 loss (two losing picks totaling -$200, one winning pick for $100).
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With Bankroll U's Loss Limit, you still have $900 of room before your Bankroll would be closed.
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On a platform using a 10% trailing Drawdown Limit, a $100 loss from a $1,000 peak would already trigger the limit.
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Example: a dip after a peak

Your Bankroll grows from $1,000 to a peak of $1,500, then dips to $1,200 — still a $200 profit overall.
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With Bankroll U's Loss Limit, this isn't a problem — you're still profitable, and you have $1,200 of room before the Loss Limit would apply.
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On a platform using a 10% trailing Drawdown Limit, the $300 drop from the $1,500 peak would trigger the limit, even though the account is up overall.

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