Hard vs Soft Breach Types
Hard breach kills the account instantly; soft breach closes trades or blocks payouts but lets you continue.
Applies to 3 firms • Risk Management • ALL
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Why this rule exists
Hard breaches terminate on first touch: daily loss, max loss, contract-cap excess, and weekend-hold violations on standard funded. There is no appeal and no second chance inside the same account. Soft breaches are recoverable: equity warnings, margin calls that close positions, consistency flags that raise targets, and payout holds pending review. Treat every warning banner as a final notice. On $100K, the gap between a soft margin close and a hard daily breach can be one unmanaged lot.
How traders get caught
Risk floors are enforced tick by tick against live equity including spread and swaps. Server-time resets and intraday peaks shrink usable room far below what the headline percent suggests.
How to stay safe
Check the Source Inspector for the exact FAQ excerpt, test your equity distance in the simulator, and keep a 20% buffer above the nearest floor.
The Formula
How it is calculated
Real Dollar Example
On a $100K account with 4% daily ($4,000 room), equity dipping $4,001 below baseline is a hard breach — account gone. Hitting 78% margin usage triggers a soft broker close of one position — account survives. Crossing 6 futures minis on a 5-mini cap is hard; a consistency flag to 55% best-day only raises the target.
Common Traps & Mistakes
Treating a margin warning as the real limit and discovering the hard daily floor $200 later.
Assuming a soft consistency flag means the strategy is banned — it usually just raises the target.
Begging support to reinstate a hard breach — automation logs make reversal nearly impossible.
Firms using this rule
Rule FAQ
Frequently Asked Questions: Hard vs Soft Breach Types
What is the Hard vs Soft Breach Types?
Hard breach kills the account instantly; soft breach closes trades or blocks payouts but lets you continue.
How is Hard vs Soft Breach Types calculated across prop firms?
Hard = Instant Termination; Soft = Position Close / Target Raise / Payout Hold
What are the most common mistakes traders make with Hard vs Soft Breach Types?
Treating a margin warning as the real limit and discovering the hard daily floor $200 later. Assuming a soft consistency flag means the strategy is banned — it usually just raises the target. Begging support to reinstate a hard breach — automation logs make reversal nearly impossible.
Related guides
Keep learning this cluster
Daily Drawdown Limit
The maximum loss your account can incur in a single 24-hour cycle before automatic breach.
Static Max Drawdown Explained
A fixed loss floor set once at purchase that never moves, no matter how much profit you make.
Lot Size & Contract Limits
Max lots per trade and max contracts held — exceed it and the account is hard-breached.
Prohibited Strategies List
Latency arbitrage, tick scalping, grid martingale, and account hedging void profits at review.
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