What is drawdown and how is it calculated?

The equity stop-out level (aka drawdown) is the lowest value of the account allowed. Once the account equity value is below this level, the fund will close all running trades, and disable trading and access. No matter how much the trader profits in the account, the maximum loss (drawdown) allowance increases. The trader can always choose to keep profits in the account in order to increase the maximum drawdown amount. Any payouts requested will reduce the account balance, hence reducing the maximum drawdown.

Example for Hyper-Growth: If the initial balance is $10,000 and the maximum drawdown of 6% is $600 then the account will be closed below the equity level of $9,400, Let’s say your account goes up to $10,300, the maximum drawdown is now $900.

Example for High Stakes: If the initial balance is $5,000 and the maximum drawdown of 10% is $500 then the account will be closed below the equity level of $4,500. Let’s say your account goes up to $5,300, the maximum drawdown is now $800.

Example for Bootcamp: If the initial balance is $10,000 and the maximum drawdown 5% is $500, the account will be closed below the equity level of $9,500. Let’s say your account goes up to $10,300, the maximum drawdown is now $800.