How a trailing drawdown works
Every funded or evaluation account has a level where it fails. With a static drawdown that level is fixed: starting balance minus the allowance. With a trailing drawdown it follows your highest balance or equity upward, always staying the same distance below it, and it never comes back down.
The calculator uses this rule:
- Static: floor = starting balance − maximum drawdown.
- Trailing: floor = highest balance (or equity) − maximum drawdown, but never lower than where it started, and never higher than the lock level if your firm has one.
- Room left: balance now − floor. When it reaches zero, the account fails.
Worked example
A $50,000 account has a $2,500 end-of-day trailing drawdown that locks at the starting balance. It starts with a floor of $47,500. You close a day at $51,200, so the floor rises to $48,700. Today you are at $50,400, which leaves $1,700 of room. Once a day closes at $52,500 or higher, the floor reaches $50,000 and stops moving.
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Intraday vs end-of-day trailing
The two versions use the same formula but a different “highest” number. Intraday trailing watches your equity tick by tick, so if a trade is up $800 and you let it come back to breakeven, the floor has still risen $800. End-of-day trailing only looks at your balance when the day closes, which gives you more freedom inside the day.
How to protect your room
- Size every trade from the room you have left, not from the full account. The position size calculator does this for forex, gold and futures.
- On an intraday trailing account, take partial profit or move your stop sooner: unrealised highs count against you.
- Check the daily loss limit too. Many accounts fail on the daily rule while the overall drawdown still has room.
- Before you start, test your strategy's odds with the challenge calculator.