The Position on Close (PoC) drawdown mechanism—referred to within FundedFuturesFamily’s Live Trading Program as End of Position Drawdown (EoP)—represents a modern, trader-aligned risk management approach that emphasizes flexibility and strategic execution over punitive real-time monitoring. This article outlines what PoC is, how it works, and why it benefits professional traders operating under the FFF model.
What is Position on Close (PoC) Drawdown?
PoC Drawdown is a trailing risk control system that only adjusts your drawdown threshold after a position is closed in profit. It is not influenced by unrealized gains or intraday fluctuations. This approach creates a buffer between real market volatility and a trader’s protected account balance, allowing for greater freedom in trade management.
Key Features:
Dynamic but delayed adjustment: The drawdown increases only when a trade is closed and profit is realized.
Losses do not reduce the trailing drawdown: Once the drawdown moves up, it remains there—losses afterward do not scale it back.
Traders exit drawdown after recovering their account's drawdown buffer, gaining access to full payout eligibility.
How Does It Work?
Each live account begins with a predefined maximum drawdown limit. For instance, a $50,000 account has a $2,000 drawdown, meaning the initial minimum balance is set at $48,000.
When a trader closes a profitable trade:
The realized profit is added to the trailing drawdown floor.
The new minimum balance becomes the initial balance minus the drawdown + cumulative realized profit.
Once the realized profit equals the full drawdown limit (e.g., $2,000 for a $50K account), the trader is out of drawdown. At that point, the new minimum balance becomes the starting balance + $1,500, which then serves as a permanent capital protection threshold.
Example: Position on Close in Action
$50,000 Live Account | $2,000 Drawdown | Initial Min Balance: $48,000
Trade | Balance After Trade | Realized P&L | Cumulative Realized Profit | New Drawdown Floor (PoC) |
Start | $50,000 | – | – | $48,000 |
Trade 1 | $50,700 | +$700 (closed) | $700 | $48,700 |
Trade 2 | $51,500 | +$800 (closed) | $1,500 | $49,500 |
Trade 3 | $51,200 | –$300 (closed) | $1,200 | $49,500 (unchanged) |
Trade 4 | $52,000 | +$800 (closed) | $2,000 | $50,000 (drawdown recovered) |
Trade 5 | $52,600 | +$600 (closed) | $2,600 | $50,600 |
Key Takeaways:
Only closed profits affect the drawdown floor.
Losses like Trade 3 do not reduce the trailing minimum.
After fully recovering the drawdown, the account is eligible for withdrawals and full profit split benefits.
Why PoC is More Trader-Friendly
Attribute | Position on Close (PoC) | Real-Time Trailing Drawdown |
Adjusts on Unrealized Gains? | No | Yes |
Drawdown Reduces on Losses? | No | Yes |
Encourages Strategic Holds? | Yes | No – penalizes long open positions |
Psychological Pressure | Lower | High |
Supports Long-Term Trades? | Yes | No |
Enhancing Risk Management is the goal of FFF
The Position on Close (PoC) drawdown model used by FundedFuturesFamily reflects a commitment to professional trading practices, flexibility in strategy, and trader capital preservation. By decoupling drawdown adjustments from real-time market fluctuations, FFF allows traders to focus on execution, risk-adjusted returns, and long-term account growth without fear of being prematurely penalized during profitable setups.
For serious traders seeking a balance of account safety and strategic freedom, PoC provides a competitive advantage in the live trading environment.