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What is the maximum daily loss?
What is the maximum daily loss?

Maximum daily loss

Updated yesterday

An important point of clarification in both the Breakout Evaluation and the Breakout Account: demo account balance and demo account equity are two different things.

Demo account balance refers to the balance of the demo account not including any open positions.

Demo account equity refers to the balance of the demo account including any open positions.

Your demo account balance and demo account equity are visible and trackable in real-time via our trading terminals.

Maximum daily loss = [demo account balance at 1700 EST] - [applicable % decline in equity]

Maximum daily loss and maximum drawdown are in force at the same time. Reaching or exceeding either of these thresholds will result in a breach of the risk rules.

Slippage, commissions, swaps, and any other fees apply to this rule.

Maximum daily loss is the daily loss limit for a trading demo account.

Reaching and/or exceeding the maximum daily loss will result in a breach of the risk rules.

The maximum daily loss updates every day at 1700 EST for all crypto accounts.

At that time, we record your demo account balance and that number is your baseline for the trading day.

If, at any point during the next 24 hours, your demo account equity reaches or exceeds the maximum daily loss, the demo account will be in breach of the maximum daily loss rule.

For example: You have a $100,000 demo account. Your demo account balance at 1700 EST is $105,000. The maximum daily loss is 4%. For the next 24 hours i.e. until 1700 EST the next day, if your demo account equity reaches or falls below $100,800 - which is a 4% reduction from the starting balance - the demo account will be in breach of the maximum daily loss rule.

Another example: You have a $100,000 demo account. Your demo account balance at 1700 EST is $98,000. The maximum daily loss is 4%. For the next 24 hours i.e. until 1700 EST the next day, if your demo account equity reaches or falls below $94,080 - which is a 4% reduction from the starting balance - the demo account will be in breach of the maximum daily loss rule.

A nuanced example: You have a $100,000 demo account. The maximum daily loss is 4%. Your demo account balance at 1700 EST is $100,000. On that same day, you make a 5% simulated gain on the demo account after closing a trade, meaning your demo account balance is $105,000. On that same day, you open a position with -$4200 unrealized losses or more (4% of $105,000) and hold it. At 1700 EST, given your demo account balance will update to $105,000, the demo account will automatically breach the daily risk limit given that $4200 is 4% of your updated demo account balance ($105,000).

In the simplest terms: we use demo account balance to anchor your risk rules and use demo account equity to measure breaches of those risk rules.

Your demo account resets between the evaluation stages. It also resets when you receive your Breakout Account. In both instances you will receive an email with new login credentials.

For example: You have a $100,000 demo account for a 2-Step evaluation. You pass the first stage. In the second stage, you will start with a fresh $100,000 demo account. Your balances and trades do not carry over between stages. If you pass the evaluation stage and receive access to a trading account, you will also start with a fresh $100,000 trading account balance.

It is crucial that you understand the risk rules when trading in your Breakout Account.

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