At a glance
- Static floors stay at the original threshold in the simplified model.
- Trailing floors can rise without moving back down after losses.
- An end-of-day calculation does not imply end-of-day-only enforcement.
Ask three questions about every drawdown rule
First, identify the reference: initial balance, highest closed balance, end-of-day balance or an equity high that includes open positions. Second, identify when that reference is sampled. Third, identify the metric monitored for a breach. Those are three different decisions, even when a marketing table compresses them into one label.
The word “trailing” alone does not identify a complete rule. Some limits stop moving after a specified threshold. Account-stage changes and withdrawals can also change the floor. Read those conditions before using a formula.
One account path, three simplified models
This example is hypothetical. Start with $50,000 and a $2,000 allowance. During a session, equity reaches $51,200; the account then closes at $50,500. Ignore costs and any stop-trailing provision.
| Model | Reference after the session | Illustrative floor |
|---|---|---|
| Static | Initial $50,000 | $48,000 |
| End-of-day trailing balance | Closing $50,500 | $48,500 |
| Intraday trailing equity | Peak $51,200 | $49,200 |
At the same final $50,500 balance, the remaining room is $2,500, $2,000 or $1,300. The difference comes from the reference value, not the closing result. Test your own numbers in the drawdown model calculator.
Updating a floor and monitoring a breach are different
A threshold calculated from closed balances can still be breached by an open loss if enforcement uses equity. Waiting until the day closes would then miss the actual breach event. Include commissions and other adjustments whenever the governing rule includes them.
For a concrete primary-source example, Topstep distinguishes end-of-day updates from real-time enforcement. FTMO’s objectives also describe which equity components enter its loss tests. Read the specific product sections rather than applying one rule to an entire brand.1, 2
What to record before buying
Copy the floor formula, breach comparison (“touches” versus “falls below”), reference timezone, whether open profits affect the high-water mark, and the level where trailing stops. Then add the funded-stage and post-withdrawal rules as separate rows.
These models explain mechanics, not a safe position size. The futures directory and forex directory help locate programs; use their official rule links to resolve the exact floor.
Sources & dates
Primary pages accessed on . A source can change after publication. The examples above are not a claim about a program’s current price.
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Put this guide to work
Use your own assumptions in a simplified model, then check the governing rule.
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