The six parameters
To decide whether an account passed, failed, or is still running, an engine needs exactly these. Everything else in a rulebook is either one of these in different words, or an operational term that does not affect the arithmetic.
- Profit target — how much you must make, and whether unrealised counts.
- Daily loss limit — how much you may lose in a day, and measured from what.
- Maximum drawdown — the floor, and which peak it follows. Covered in what breaches an account.
- Minimum trading days — how many days must count, and what makes a day count.
- Maximum calendar days — a deadline, or none.
- Consistency — a cap on how much of your profit may come from one day. Covered in payouts.
Two more rules exist in most rulebooks — news trading and weekend holding — and they behave differently enough to deserve their own treatment at the end of this page.
The daily loss limit is two decisions, not one
This is where the most consequential hidden difference lives. "5% daily loss" is not a complete rule. The percentage needs something to be a percentage of, and firms use four different anchors:
- Day-start balance — 5% of what your closed balance was when the day began.
- Day-start equity — 5% of balance plus whatever was floating at the reset.
- The higher of the two — the more generous reading when you carried an open profit overnight.
- Account size — 5% of the plan size, fixed, regardless of where you currently stand.
The last one behaves differently from the other three in a way worth pausing on. Anchored to account size, the limit is a constant number of dollars for the life of the account. Anchored to day-start balance, it shrinks as you lose — a bad week reduces tomorrow's allowance, and each subsequent day gives you less room than the last.
Two traders on identically advertised "5% daily" rules therefore have limits that diverge the moment either of them is down, and the divergence grows exactly when it hurts most.
The second decision is whether floating counts. If it does, an open loser can end your day without you closing anything. If it does not, the day is judged on what you booked.
Find both answers in your own rulebook before sizing anything. They are usually one sentence apart and easy to skim past.
What makes a day count
Minimum trading days sounds trivial and is not, because firms have to stop people opening and closing a single position on ten consecutive days to satisfy it. Three qualifiers are in use:
- Any closed trade — a day counts if you traded at all. The loosest, and the one the button-clicking trick defeats.
- Net profit at or above an amount — the day must have made at least a certain sum. Losing days do not count toward the requirement, which quietly extends the calendar for anyone having a bad run.
- Absolute net result at or above an amount — the day must have moved by at least that much, in either direction. A day that lost enough still counts.
The middle one has an effect worth noticing: it means a losing day costs you twice, once in money and once in time.
Maximum calendar days
Either a deadline exists or it does not. Modern accounts increasingly have none, which changes the strategy completely — without a deadline the correct behaviour is to trade less and wait for setups, and with one the target starts competing with the drawdown rule for your attention.
Our engine treats an absent deadline as genuinely absent rather than as a very large number, because "no deadline" and "365 days" produce different pacing advice and only one of them is true.
The two rules that are warnings, not breaches
News trading and weekend holding are in most rulebooks, and our engine deliberately does not convert either into an account breach.
The reason is that we cannot know the outcome and the firm can. At many firms a trade taken inside a restricted news window is voided or its profit removed rather than the account being failed, and the decision is made by the firm's own review. An engine that marked the account "breached" would be asserting something it has no way to establish, and a trader would either panic or stop trusting the tracker.
What the tracker does instead is warn before the event, while the warning still changes something — a countdown to the next high-impact release for the currencies you are actually exposed to, widening to the firm's window when the account has one. How that exposure is determined from your symbol is covered in news windows.
The same reasoning applies to weekend holding: we say a position is open into the weekend and that the firm restricts it, and we do not declare a result that only the firm can declare.
One rule about rules
The rulebook that applies is the one in force when the challenge started. Firms change terms, and the terms on the site today are for accounts opened today.
That means the correct move on the day you start is to save a copy of the rules as they stand. Not because firms are dishonest, but because six weeks later, when you are trying to work out whether something counted, the page you are reading may no longer be the page you agreed to.