What is the Maximum Loss Limit?
Updated over a week ago

### What is the Maximum Loss Limit?

The Maximum Loss Limit, sometimes called the MLL or trailing drawdown, is a minimum account balance that trails with your profits made in the account. It is in place to help traders keep the profits they've earned and encourages them not to give too much back to the markets.

### How is the Maximum Loss Limit calculated?

The Maximum Loss Limit is calculated from your account balance high at the end of the trading day. An example and visual representation of how to calculate that is listed below/

• If you make \$500 on the first trading day in the \$50K account, your account balance will be \$50,500, which will make your Maximum Loss Limit \$48,500 (\$2,000 from the account balance high). If you were to lose \$500 the next day, your account balance would go back to \$50,000, but your minimum account balance will remain \$48,500. This number will not go below \$48,500 for the remainder of that evaluation period.

Once the Maximum Loss Limit reaches the initial starting balance, it won’t change for the remainder of the account. This means that if you were to make \$2,500 the next day and your account balance is \$52,500, your Maximum Loss Limit will move up to \$50,000 and stay there.

### When is the Maximum Loss Limit Calculated?

• If, while trading, the account balance falls below the minimum account balance displayed on your Trader Dashboard, you will be pulled from your trades right away, your account will be liquidated, and the rule will be broken.

• Keep in mind that the Maximum Loss Limit value is calculated and set at the end of the trading day. This means the minimum account balance will not be adjusted while you are trading; this will be adjusted between trading days based on your account balance high.

## What happens if I break the Maximum Loss Limit rule?

• If you break the Maximum Loss Limit rule, your account will be automatically liquidated for the rest of the trading day. This means that any orders placed after hitting the Maximum Loss Limit will be rejected.

• Keep in mind that the account will remain ineligible for funding until it's Reset, but you can still trade on an ineligible account for practice once the markets reopen (OR you are welcome to trade on your Practice Account if you'd like).

• Hitting the Maximum Loss Limit in an Express Funded Account or Live Funded Account means the account will be automatically closed at the end of that trading day.

In a Funded Account (Express Funded Account or Live Funded Account):

### Can I request that my Maximum Loss Limit be adjusted in my account?

No, you cannot request your Maximum Loss Limit be adjusted in your account. Topstep cannot make any risk parameter adjustments to the Trading Combine or Express Funded Accounts.

However, once you are advanced to a Live Funded Account, you can reach out to our Risk Management Team and request an adjustment to your parameters.

### How do payouts affect the Maximum Loss Limit?

Payouts affect the Maximum Loss Limit in the following ways:

• Your Maximum Loss Limit will always be set to \$0 after your first payout.

• If your limit has already reached \$0 and you take a payout, your limit will remain at \$0. At that point, the capital remaining in your account will be the maximum amount you will be able to lose.