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Smart Drawdown Breakdown
Smart Drawdown Breakdown

A breakdown of our smart drawdown feature and how it affects your account.

Updated over a week ago

Introduction

Our Smart Drawdown model is designed to enhance your trading experience and offer better prices and conditions. Unlike other trailing drawdown firms with a -5% or -6% drawdown, our Smart Drawdown starts at -10% and remains static until you are well into profit, at which point it moves once.

Smart Drawdown operates in a unique way: once a trader reaches a balance gain of 5% or more, our system will automatically update their drawdown to the -5% of the starting balance, and it will remain at this level. This means that traders can continue to trade freely, without worrying about their drawdown percentage increasing beyond -5% of their starting balance.

Once your Drawdown has updated to -5% of your starting balance it will then never move from here, unless you scale your account. At this point, your drawdown will be updated to -5% of your new scaled balance, excluding any profits.

Smart Drawdown offers more significant benefits to our traders, including better pricing conditions, no time limits, faster scaling, and faster profit split scaling.


Example

Let's say you start with a $100,000 Smart Instant Account.

When you first receive your credentials your drawdown will be Static at -10% ($90,000 in this case). Once you make a 5% gain on your account, in this example $5000 in balance gain ($105,000). Your drawdown will then update to - 5% below your starting balance ($95,000). This will then never move from here.

Therefore,

At start of the account:

Starting Balance - $100,000

Current Balance - $100,000

Drawdown (10%) - $90,000

After making 5% gain on your starting balance:

Starting Balance - $100,000

Current Balance - $105,000

Drawdown (5%) - $95,000

Your Drawdown changed from 10% to 5% and will not decrease from 5% of your starting balance.

This allows you to maintain a minimum of 10% drawdown buffer at all times until you exceed the 5% threshold, where your drawdown buffer can then increase even further.

Note this 5% drawdown will NEVER move again from this spot, allowing us to reduce our risk and pass these benefits on to you, with no time limits, lower prices, larger profit splits, faster scaling and more!

Also note that your account's Maximum Drawdown is calculated based on your account's Equity.


Where Smart Drawdown derived from?

We recognized the potential advantages that firms employing a trailing drawdown approach offered to their traders, but we also identified the potential drawbacks. As a result, we developed a new solution specifically for traders, known as our Smart Drawdown Model.

Our innovative Smart Drawdown Model combines the best of both static and trailing drawdowns, providing traders with a unique and unparalleled experience. With this new approach, you'll enjoy the benefits of a trailing drawdown, such as no time limits on challenges, reduced costs, and improved potential profitability thanks to easier scaling opportunities. You'll also appreciate the advantages of a static drawdown, including reduced stress levels as your drawdown won't be trailing behind you. You'll always know what your drawdown is, and the best part? It only changes once!

So let us introduce you to Smart Drawdown, the ultimate solution for traders seeking a balance between flexibility, profitability, and peace of mind!

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