Glossary / Glossary term
Daily loss limit
The 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.
Also called daily drawdown. Each trading day has a floor, and equity must stay at or above it at every moment, open positions included.
How it is measured here
At 00:00 UTC the floor is set at the higher of balance and equity at 00:00 UTC, minus a share of the starting balance: 4% on Classic 1-Step and 5% on 2-Step.
Because the room is a share of the starting balance, it is the same amount every day. Because the anchor follows the account, the floor rises after a winning day and falls after a losing one.
Example
On a Classic 1-Step 10K account the daily room is $400. A day that opens with the balance at the starting balance has its floor that far below it; a day that opens higher has a higher floor.
The floor that ends an account is always the higher of the daily floor and the max-loss floor.
Related
- Daily drawdown vs max drawdownTwo loss floors, measured differently: one resets every day, one never moves. Two worked examples show which one ends an account, and when.
- How the daily loss floor movesThe floor resets at 00:00 UTC from the higher of balance and equity. Here is what that means for a winning day, a losing day and an open position.
- 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.
- Drawdown simulator