How does the Daily Drawdown limit work on Stocks accounts?

The Daily Drawdown rule is the maximum amount you can lose throughout a single day.

Your demo account will be closed automatically and permanently once you reach the Daily Drawdown limit.

We calculate your Daily Drawdown Limit based on your Equity (Open P&L) on your Dashboard, and we update your new Daily Drawdown limit every day at 16:15 CT when the markets close.

*Please note that commissions for executing trades will be included in your daily P&L.

For example:

If you have a $25,000 Stocks account and your Daily Drawdown Limit is $500, you will see on your Dashboard that your Daily Pause limit is set to $24,500, meaning if your current equity (unrealized balance) drops below $24,500, your demo account will be disabled until the next trading day.

If you stop your day at $24,600 equity, then at 16:15 CT when we calculate your new Daily Pause limit for the new day, we will subtract the $500 Daily Pause you are allowed and you will see the new Daily Pause limit on your Dashboard set at $24,100 (Previous day's closing Equity - Daily Pause limit).

Important Note:

If your equity drops below your Drawdown limit, your account is considered breached and immediately disabled.

A notification is then sent to your dashboard to close the open positions that took you into negative equity and also close the account. This action usually takes up to 30 seconds.

In the process of those 30 seconds, if there is positive movement of your open position, you may see that your account was breached, but your equity is above the Drawdown limit. Although we understand this may cause confusion, due to the markets being volatile we are unable to breach accounts in real-time, but rest assured no account is ever breached unless the equity drops below the Drawdown limit.

If you have any concerns regarding this, feel free to go through your trades to confirm.