Glossary / Glossary term
Breach
A breach is the moment equity falls below the daily loss floor or the max loss floor; the account stops and its positions are closed.
A breach ends an account. It happens when equity falls below either floor, by even a cent; equity exactly at the floor is allowed. The check runs on every price move, on the composite mark price, not on one exchange's price.
What happens
Open orders are cancelled, positions are closed at market, and the account stops. The breach report shows the moment, the rule, your equity and the floor, the composite mark and each venue's price, and the positions you held.
When it goes to review instead
If one of the prices behind the composite was unreliable at that moment, or an unusual number of accounts breached on the same symbol at once, the breach is not final. The account keeps its positions in reduce-only mode until a person confirms or reverses it with the stored prices.
After a breach
After a breach in an evaluation phase, the dashboard offers a reset for a limited time: a new account that starts at the phase you breached, with the same rules, for a reset fee. A breached funded account is not reset.
Related
- Daily loss limitThe daily loss limit is the most equity may fall in one trading day, measured from that day's anchor; crossing the floor ends the account.
- Max loss limitThe max loss limit is the most an account may lose in total; equity must stay above the starting balance minus that amount.
- FAQ
- Why a breach uses a composite markOne exchange can print a wick the rest of the market never saw. The composite mark, degraded states and breach reviews keep it from failing you.