Static Max Drawdown Explained
A fixed loss floor set once at purchase that never moves, no matter how much profit you make.
Static drawdown is the simplest model: on a $100K account with 8% max loss, the floor is $92,000 forever. Banking $10,000 of profit never raises the floor, so your usable buffer grows to $18,000. It never locks at breakeven, which means you can always fall back toward the original floor. Most FX 2-step programs use static because it rewards consistent growth without punishing pullbacks.
Applies to 3 firms • Risk Management • Evaluation + Funded
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Why this rule exists
Static drawdown is the simplest model: on a $100K account with 8% max loss, the floor is $92,000 forever. Banking $10,000 of profit never raises the floor, so your usable buffer grows to $18,000. It never locks at breakeven, which means you can always fall back toward the original floor. Most FX 2-step programs use static because it rewards consistent growth without punishing pullbacks.
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 8% static max loss, the floor is $92,000. Grow equity to $112,000 and the floor stays $92,000, leaving $20,000 of room. A drop to $93,500 is still safe; only a touch of $92,000 breaches.
Common Traps & Mistakes
Confusing static with trailing and cutting winners early to defend a floor that never moved.
Assuming profit locks the floor at breakeven — static never locks, so you can give back open profit down to the original floor.
Forgetting the daily limit still applies on top of static max loss.
Firms using this rule
Related guides
Keep learning this cluster
Trailing Drawdown vs Static Drawdown
A loss floor that ratchets higher as your peak equity rises, locking in risk levels.
End-of-Day Drawdown Model
Trailing floor set from the highest end-of-day balance, but enforced live against intraday equity.
Intraday Trailing Drawdown
The strictest model: every intraday equity peak instantly drags the loss floor higher.
Hard vs Soft Breach Types
Hard breach kills the account instantly; soft breach closes trades or blocks payouts but lets you continue.
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