Phase 1 (Verification)
Trading Objectives
Profit Target: 9%
Daily Drawdown: 3%
Maximum Drawdown: 6%
Weekend Trading : Allowed
Maximum Drawdown - 6% (Hard Breach)
The Maximum Drawdown defines the maximum total loss allowed on the account during Phase 1.
Rule
Your balance or equity must never fall below the Maximum Drawdown limit
Includes both closed and floating losses
Monitored at all times
Maximum Drawdown:
6% of the initial account size
Breaching this rule results in immediate account termination.
Example
Account Size: $100,000
Maximum allowed loss: $6,000
Minimum allowed equity/balance: $94,000
❌ Equity or balance reaches $94,000 or below → Hard Breach
✅ Equity remains above $94,000 → Account remains active
Daily Drawdown - 3 % (Hard Breach)
The Daily Drawdown defines the maximum loss allowed within a single trading day.
Rule
Calculated using the higher of balance or equity at the start of the day
Includes floating and closed losses
Resets daily at the broker server reset time
Daily Drawdown:
3% of the higher value between balance or equity
Breaching this rule results in immediate account termination.
Example
Account Size: $100,000
Start of the day:
Balance: $100,000
Equity: $100,000
Daily Drawdown Limit:
3% × 100,000 = $3,000
Minimum allowed equity for the day: $97,000
❌ Equity drops to $97,000 or below at any moment during the day → Hard Breach
✅ Equity stays above $97,000 → Rule respected
Funded Stage – Shark Funded Lite 1 Step
Funded Stage Trading Conditions
Profit Split: 80% to the trader
Payout Frequency: Weekly
Trading Period: Unlimited
Rewards: Withdrawable profits based on approved payouts
Weekend Trading : Allowed
Your withdrawl request should always be less than daily drawdown to maintain equity cushion.
Risk Limits – Funded Stage
Daily Drawdown – 3% (Hard Breach)
Maximum loss allowed in a single trading day
Calculated using the higher of balance or equity
Includes closed and floating losses
❌ Reaching or exceeding the limit → Account closed
Maximum Drawdown – 6% (Hard Breach)
Total loss allowed on the account at any time
Balance or equity must never fall below 90% of the initial account size
Includes all closed and floating losses
❌ Breaching this limit → Account closed
Giveaway accounts have a withdrawal limit of 2 percent only .
Additional Guidelines (Soft Breach)
Soft breaches relate to unhealthy or risky trading behavior. These actions do not immediately close the account, but they may result in warnings, restrictions, or review by the risk team. Repeated or severe violations may lead to further action.
Toxic Trading Behavior (Soft Breach)
Toxic trading means trading in a careless or unsafe way that cannot be sustained long-term.
It shows poor risk control and can put the account at risk if continued.
This does not immediately close your account, but it may trigger warnings or restriction
Ignoring basic risk management
Excessive or reckless trading behavior
Trading without a clear strategy
Emotion-driven decisions
In funded phase and instant accounts , no warning will be given if it is executed , it will be considered as a hard breach.
Excessive Risk-Taking / Over-Leveraging
Using risk that is disproportionately high compared to your account size.
Using maximum lot size on every trade
Opening positions that can wipe out a large portion of the account quickly
Relying heavily on leverage instead of proper risk control
Layering
Traders are not allowed to open 3 or more positions and lot size simultaneously without placing a stop loss. This practice , known as "layering trades" is considered a violation of our risk management policies .
This is considered as a soft breach in challenge phases and hard breach in funded phase and instant accounts .
Martingale Trading Policy – FAQ
What is considered a Martingale strategy?
A Martingale or loss-recovery strategy includes increasing lot size or position size after a losing trade within 60 minutes, with the intention of recovering previous losses.
Does timing matter?
Yes. Any increase in position size within 60 minutes of a losing trade may be classified as Martingale behavior, even if the trade is not placed immediately.
Examples of Martingale behavior include:
Increasing or doubling lot size within 60 minutes after a losing trade
Re-entering the same or similar trade with a larger position within 60 minutes of a loss
Progressive lot size increases following consecutive losses in a short time window
Any structured attempt to recover losses by increasing risk instead of maintaining consistent risk per trade
What happens if Martingale is used during the Challenge phase?
Use of Martingale strategies during Challenge phases is considered a soft breach and may result in warnings, restrictions, or challenge failure at the firm’s discretion.
What happens if Martingale is used during the Funded phase?
Use of Martingale strategies during Funded phases is strictly prohibited and will be treated as a hard breach, which may lead to immediate account termination.
What is expected instead?
Traders are required to follow consistent risk management, maintaining stable or proportionate risk per trade and avoiding loss-recovery strategies.
Gambling Behavior
Trading that resembles gambling rather than structured decision-making.
Random trades without analysis
Revenge trading after a loss
Overtrading to recover losses
Emotion-based entries
Overtrading
Entering too many trades in a short period without a clear strategy.
Constantly opening and closing trades without setup confirmation
Trading excessively due to impatience or emotional pressure
Tick Scalping
Extremely fast, high-frequency entries and exits designed to capture very small price movements.
Opening and closing multiple trades within 120 seconds
Exploiting micro price fluctuations
Excessive tick scalping may be restricted due to execution and liquidity risks.
Arbitrage Trading (Restricted)
Arbitrage means opening trades to take advantage of price differences or correlations instead of real market analysis.
It is usually done to reduce or remove risk rather than to trade normally.
This often involves placing opposite or related trades across instruments, accounts, or platforms.
Example : Correlated pair trading
Buy EUR/USD
Sell GBP/USD (highly correlated pair)
When used to cancel risk instead of normal strategy, this is treated as arbitrage behavior.
Hedging
Hedging means opening opposite or related trades to reduce or cancel market risk instead of managing risk normally.
Traders usually hedge to protect themselves from losses, but when used improperly, it can be considered a soft breach.
Example 1: Opposite trades on the same pair
Buy EUR/USD
Open a Sell EUR/USD at the same time
This locks the position and removes real exposure to the market.
Trading Behavior
Behavior that shows lack of discipline or structured approach.
Trading during illiquid market hours
Frequently changing strategy
Ignoring risk limits
Emotional decision-making
Such behavior may trigger monitoring or restrictions.
One-Sided or Directional Bias Trading
Taking repeated positions in only one direction without proper market justification.
Only buying or only selling regardless of market structure
Overexposure to one bias
This increases risk and may result in soft-breach action.
Reverse Trading
Taking trades designed to intentionally lose or offset positions elsewhere.
Taking trades designed to intentionally lose or offset positions elsewhere, including actions taken to manipulate overall exposure across accounts or instruments.
Purposely placing losing trades, either to balance risk on another position or to influence account metrics.
Mirroring positions to manipulate exposure, whether on the same account or across related instruments.
Opening offsetting or manipulative trades within a short time window:
Any trades placed within a 15-minute gap of another position that appear intended to offset, mirror, or neutralize exposure may be classified as manipulative behavior.
News Trading
During the Funded Phase, traders are not allowed to hold or execute trades during news events, unless specific timing conditions are met.
News Trading Restriction Window
Trades must NOT be opened or closed within:
10 minutes before a news event
10 minutes after the news event
This creates a 20-minute restricted window around each news release.
This rule applies to all trade types, including:
Manual trades
Pending orders
Stop loss orders
Take profit orders
During news speeches, the restriction window extends:
10 minutes before the speech
Until 10 minutes after the speech ends
Any trade executed within this restricted window will be considered a violation.
Example
High-impact news time: 3:00 PM
Restricted window: 2:50 PM – 3:10 PM
❌ Trade opened at 2:55 PM → Violation
❌ Trade closed at 3:05 PM → Violation
Important Notes
All trades are reviewed by the Risk Management Team during phase completion and payouts.
Forex Factory is used as the official news calendar.
If a violation occurs, the trader is fully responsible, even if it was unintentional.
News trading violations may result in account breach or action.
Special Note for Swing Traders
To support swing trading while preventing news gambling:
Trades opened at least 5 hours before a high-impact news event are allowed
These trades may be closed during the restricted window
Profits from these trades will be counted