Royal Challenge Drawdown
Maximum Daily Loss | 5%
In the course of one working day, the maximum daily drawdown on the account (which consists of the account’s current result of opened positions and the result of positions closed on the given day) is calculated based on the balance or equity, whichever is greater when the day changes at 5 pm est. The daily drawdown amount is always fixed to 5% of the initial balance. This includes commissions and swap fees.. If the account at any point breaches the daily drawdown the account is violated.
Your max daily loss will reset each day at 5:00pm EST. For example, if you start with a $100,000 account your max daily loss will be set at 5% ($5,000). If you end the day with a $4,000 closed profit your account balance will now be at $104,000. Your max daily loss now be set at $99,000. Your account will be breached if you fall below $99,000 in equity at any point throughout the day.
Example 2: If your account is a $100,000 challenge and you have a position open that is $5,000 in profit when the new day starts (5pm EST) the drawdown would be calculated as $105,000 - $5,000 = $100,000. If your equity goes below $100,000 at any point you have violated the max daily drawdown.
The max daily drawdown resets every day at 5:00 PM EST. Once your last balance/equity (whichever is higher) is pulled for the trading day your dashboard will update with your new Daily Breach Level. This is the amount your account equity must stay above in order to not be breached.
Drawdown Rules by Account Size
The following chart shows the maximum daily drawdown loss and overall maximum loss by account size for all Royal accounts.
Maximum Total Drawdown | 10%
The maximum total drawdown is 10%. Therefore, the equity of the account must not fall below 90% of the initial account balance both for open and closed positions, including commissions and swaps.
Any violation of the rules above will result in the termination of your trading account and you will not be eligible to move forward in the program with that account.
Click the button below to navigate to a page that outlines drawdown examples and scenarios so you are well aware of how the drawdown rules work for the Royal Challenge at The Funded Trader.
Please note both the daily drawdown and max drawdown include commissions and swap fees as well.