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How Prop Firm Drawdown Works (Static vs Trailing vs EOD)

Honest risk note: most challenge buyers fail. Nothing here is financial advice.

Max drawdown is the lowest your account may fall before it's closed. Three types:

• Static: fixed from the start. $100k with 10%: fail below $90,000, always. Firms with static drawdown.
• End-of-day trailing: moves up with your closing balance once a day. Firms with EOD drawdown.
• Intraday trailing: follows your highest open profit tick by tick; a reversal can breach it even on a winning trade.

Many trailing limits stop (lock) once you're a set amount in profit. For example, Lucid locks at starting balance + $100 source. The daily loss limit is separate and resets every day.

FAQ

Which drawdown is best for beginners?

Static is the easiest to plan around, then end-of-day trailing. Intraday trailing is the hardest.

Does the daily loss limit count open trades?

At many firms, yes. Check each firm's rule page.