When you request a payout, your maximum trailing drawdown locks in at the starting balance plus $100. From the moment you make a payout, the drawdown no longer trails with your account growth, regardless of how much you continue to grow your account.
How the lock upon payout works
When you qualify for and request a payout, the maximum drawdown locks in at your initial account balance plus $100. Here is an example to illustrate this:
Example | Value |
Initial balance | $100,000 |
Balance after profit | $105,000 |
Payout request | $3,000 |
New balance after payout | $102,000 |
Locked drawdown | $100,100 |
In this case, after your $3,000 payout, your maximum drawdown locks in at $100,100, leaving you with $1,900 of drawdown room before reaching your limit.
Important considerations
It is wise to leave a decent buffer so you do not breach your account. To avoid this, we have a couple of recommendations for you:
Recommendation | Why |
Leave some sim profits as a buffer | Instead of withdrawing the maximum amount of your sim profits, consider leaving some in your account. This will give you more breathing room and reduce the risk of breaching your account |
Grow your account further | Another option is to grow your account by an additional 5% or more before taking your payout. This will give you a larger cushion and increase the likelihood of growing and compounding your account |
Of course, the decision is ultimately yours. We are happy to process your payout, but our goal is to see you have many successful payouts with us in the future. We do not want you to jeopardize your account in any way.
Why this rule exists
The drawdown lock upon payout is designed to ensure long-term sustainability for both traders and the firm. This rule encourages traders to focus on long-term growth and compounding, which can lead to significantly larger payouts over time. By locking the drawdown at the starting balance after a withdrawal, traders are incentivized to manage their accounts with discipline and focus on continued growth.