GLOSSARY · PROP FIRMS
What is Trailing Drawdown?
A trailing drawdown is a prop firm loss limit that moves up as your account reaches new highs.
Unlike a fixed limit, the trailing drawdown follows your highest balance. Intraday trailing drawdowns can follow unrealized profit on open trades; end-of-day (EOD) versions only update at the close — a critical difference covered in Module 5.
Most firms stop trailing once the limit reaches your starting balance.
EXAMPLE
$50,000 account with a $2,500 trailing drawdown. Grow to $52,000 and your floor rises to $49,500.
LEARN IT PROPERLY — FREE