Trailing Drawdown
Trailing Drawdown is a moving risk floor that follows your account as equity reaches new highs. It protects part of the progress you have made by moving the breach floor upward when the account grows.
Trailing Drawdown protects progress. If your equity reaches a new high, the trailing floor can move upward. If your equity later drops, the trailing floor does not move downward.
Trailing Drawdown in one sentence
Your trailing floor is based on the highest equity reached by the account minus the account's Trailing Drawdown limit. If live equity falls below that floor, the account can breach the Trailing Drawdown rule.
trailing floor = highest equity − trailing drawdown limit
trailing consumed = highest equity − live equity
trailing remaining = trailing drawdown limit − trailing consumed
Key terms
Highest equity
Highest equity is the highest live equity reached by the account during its current lifecycle. It can increase when balance and/or open PnL push live equity to a new high.
Trailing Drawdown limit
The Trailing Drawdown limit is the allowed distance between highest equity and the trailing floor. The amount depends on your account model, capital, and configuration.
Trailing floor
The trailing floor is the minimum live equity level allowed by the Trailing Drawdown rule. If live equity falls below this floor, the account can breach.
Live equity
Live equity is your current account balance plus open PnL from open positions. Because Trailing Drawdown uses live equity, open positions can move the account closer to the trailing floor.
Confirmation buffer
FairTicks can use a short confirmation buffer before confirming a Trailing Drawdown breach. This helps avoid unfair outcomes from extremely brief micro-movements below the floor.
The confirmation buffer does not remove the Trailing Drawdown rule. It only helps confirm that the account really remained beyond the trailing breach condition.
Typical Trailing Drawdown amounts
The exact values for your account are shown in your dashboard. As a simple reference, FairTicks commonly uses the following Trailing Drawdown levels by account capital:
| Account capital | Typical Trailing Drawdown limit | Initial trailing floor example |
|---|---|---|
| $25,000 | $1,250 | $25,000 − $1,250 = $23,750 |
| $50,000 | $2,500 | $50,000 − $2,500 = $47,500 |
| $100,000 | $5,000 | $100,000 − $5,000 = $95,000 |
Always use the Trailing Drawdown value shown in your own account dashboard. Account templates, offers, and configurations can change over time.
How the trailing floor moves
The trailing floor moves when the account reaches a new highest equity. It moves upward only. It does not move downward when the account later loses money.
| Event | What happens to highest equity? | What happens to trailing floor? |
|---|---|---|
| Live equity reaches a new high | Highest equity increases | Trailing floor can move upward |
| Live equity drops | Highest equity stays the same | Trailing floor stays the same |
| Account recovers but does not reach a new high | Highest equity stays the same | Trailing floor stays the same |
| Account reaches a higher high later | Highest equity increases again | Trailing floor can move upward again |
Trailing Drawdown follows progress upward. It does not follow losses downward.
Example 1 — initial trailing floor
Account capital: $50,000
Trailing Drawdown limit: $2,500
Highest equity at start: $50,000
Initial trailing floor = $50,000 − $2,500 = $47,500
At the start, live equity must stay above the trailing floor. If live equity falls below $47,500, the account can breach the Trailing Drawdown rule.
Example 2 — profit raises the trailing floor
Account capital: $50,000
Trailing Drawdown limit: $2,500
Live equity reaches a new high: $52,000
New trailing floor = $52,000 − $2,500 = $49,500
The account has made progress, so the trailing floor moves upward. The account now needs to stay above the new floor.
Example 3 — the floor does not move down after losses
Highest equity reached: $52,000
Trailing Drawdown limit: $2,500
Trailing floor: $49,500
Live equity later drops to: $50,200
Result: no breach, because $50,200 is still above $49,500.
The trailing floor stays at $49,500.
Even though equity dropped, the trailing floor does not move lower. The highest equity remains the reference until a higher high is reached or the account lifecycle changes.
Example 4 — Trailing Drawdown breach
Highest equity reached: $52,000
Trailing Drawdown limit: $2,500
Trailing floor: $49,500
Live equity falls to: $49,400
Since live equity is below the trailing floor, the account can breach Trailing Drawdown.
The breach is based on live equity, not only closed balance. A losing open position can push live equity below the trailing floor before you manually close it.
Open positions and Trailing Drawdown
Trailing Drawdown uses live equity. This means open PnL affects the distance between your current equity and the trailing floor.
Account balance: $51,000
Open PnL: -$1,600
Live equity = $51,000 − $1,600 = $49,400
Trailing floor: $49,500
Result: live equity is below the trailing floor, so Trailing Drawdown breach can be triggered.
You do not need to close a losing position for Trailing Drawdown to matter. If open PnL pulls live equity below the trailing floor, the account can be at breach risk.
How the confirmation buffer works
FairTicks can apply a short confirmation buffer when live equity moves below the trailing floor. This gives the system a brief confirmation window before finalizing the Trailing Drawdown breach.
| Situation | What FairTicks does |
|---|---|
| Live equity is above the trailing floor | No Trailing Drawdown breach. |
| Live equity briefly dips below the trailing floor | FairTicks can wait for confirmation before finalizing the breach. |
| Live equity recovers above the floor during the confirmation window | The breach confirmation can clear. |
| Live equity remains below the floor long enough | The account can move to BREACHED. |
The confirmation buffer is designed to reduce unfair outcomes from extremely brief micro-movements. It is not a safety guarantee and does not give unlimited extra room below the floor.
The safest assumption is simple: stay above the trailing floor. The confirmation buffer is there to improve fairness, not to create a tradable grace zone.
Trailing Drawdown vs Max Loss
Max Loss and Trailing Drawdown are both account-level risk rules, but they do not work the same way.
| Rule | Reference point | Can the floor move? | Main purpose |
|---|---|---|---|
| Max Loss | Account capital and Max Loss floor logic | Can move upward through the account's Max Loss / EOD logic, then never downward. | Protects the full account from total drawdown. |
| Trailing Drawdown | Highest equity reached by the account | Moves upward when highest equity increases. Never moves downward after losses. | Protects accumulated progress as the account grows. |
If Max Loss and Trailing Drawdown are both enabled, breaching either rule can fail the account. Always monitor the closest active floor shown in your dashboard.
Trailing Drawdown vs Daily Loss
Daily Loss protects the current trading day. Trailing Drawdown protects account progress across the account lifecycle.
| Rule | What it protects | What to watch |
|---|---|---|
| Daily Loss | The current trading day. | Daily start equity, daily breach floor, live equity. |
| Trailing Drawdown | Progress made after the account reaches higher equity. | Highest equity, trailing floor, live equity. |
Which accounts use Trailing Drawdown?
Trailing Drawdown can be active on FairTicks Training and Live / Straight accounts depending on the account configuration. The exact status is shown in your dashboard.
| Account model | Trailing Drawdown behavior | What it means |
|---|---|---|
| Rapid | Can be active | Rapid has no Daily Loss, but Max Loss and Trailing Drawdown can still protect the account. |
| Classic | Can be active | Works alongside Daily Loss, Max Loss, Stop Loss, and exposure rules. |
| Discipline / Precision | Can be active | Supports a more structured account risk framework. |
| Live / Straight | Can be active | Live accounts still follow risk rules where enabled. |
Near-breach warnings
FairTicks can show near-breach warnings when your live equity gets close to the trailing floor. These warnings are designed to help you see risk before a hard breach happens.
Trailing Drawdown limit: $2,500
Highest equity: $52,000
Trailing floor: $49,500
Live equity: $49,750
Remaining distance above floor: $250
The account is close to the trailing floor, so a near-breach warning can appear.
Depending on your Trader Settings, reaching a critical near-breach zone can trigger Protection Pause. Protection Pause can block new exposure temporarily while still allowing you to close existing positions.
What happens on a Trailing Drawdown breach?
If the account breaches the Trailing Drawdown rule, FairTicks applies the official breach process.
- The Trailing Drawdown breach reason is recorded.
- Open positions are closed through the official breach process.
- The account status changes to
BREACHED. - Trading is disabled on that account.
- The breach remains visible in account history for support review.
- Reset may be available only if the account is eligible under reset rules.
A Trailing Drawdown breach is not reversed because the market later moves back above the floor. The account state is based on the official live equity and rule status when the breach is triggered.
How to read Trailing Drawdown in your dashboard
Your dashboard can show several Trailing Drawdown values.
| Dashboard value | Meaning |
|---|---|
| Highest equity | The highest live equity reached by the account. |
| Trailing Drawdown limit | The allowed distance below highest equity. |
| Trailing floor | The equity level the account must stay above. |
| Trailing consumed | How much distance has been used from highest equity to current live equity. |
| Trailing remaining | How much distance remains before the trailing floor is reached. |
| Live equity | The current equity used to evaluate whether the account is safe or at risk. |
Common mistakes to avoid
| Mistake | Why it creates confusion | Better understanding |
|---|---|---|
| Thinking the floor moves down after losses | The trailing floor only moves upward. | Once the account reaches a higher equity, the trailing floor can stay higher. |
| Ignoring open PnL | Trailing Drawdown uses live equity. | Open losses can push live equity below the trailing floor. |
| Thinking the confirmation buffer removes the rule | The buffer only helps confirm brief micro-movements. | Stay above the floor. Do not treat the buffer as extra tradable room. |
| Confusing Max Loss with Trailing Drawdown | They have different reference points and behavior. | Monitor both rules separately when both are active. |
| Thinking near-breach is already a breach | Near-breach is a warning zone. | Breach happens when the official breach condition is triggered. |
| Assuming a market recovery cancels a confirmed breach | Once breach is confirmed, account status changes. | The breach is based on official account state at the time of breach. |
Common questions
“What is Trailing Drawdown?”
Trailing Drawdown is a moving risk floor based on the highest equity your account has reached. It protects part of your account progress as equity grows.
“How is the trailing floor calculated?”
The basic formula is:
trailing floor = highest equity − trailing drawdown limit.
“Does the trailing floor move down after losses?”
No. The trailing floor can move upward when highest equity increases, but it does not move downward when equity drops.
“Does open PnL count?”
Yes. Trailing Drawdown uses live equity, and live equity includes open PnL. A losing open position can move the account closer to the trailing floor.
“Can an open position breach Trailing Drawdown?”
Yes. If open PnL pushes live equity below the trailing floor and the breach condition is confirmed, the account can breach.
“Is the confirmation buffer extra room?”
No. The confirmation buffer is not extra drawdown and not a permission to stay below the floor. It is a fairness mechanism for brief micro-movements.
“Why did my trailing floor move up?”
Your account reached a new highest equity. Since the trailing floor is based on highest equity, the floor can move upward when the account grows.
“Why did my trailing floor not move down after I lost money?”
Trailing Drawdown protects progress. Once the floor moves up, losses do not lower it again.
“Is Trailing Drawdown the same as Max Loss?”
No. Max Loss protects the full account from total drawdown. Trailing Drawdown protects progress based on highest equity. Both can be active at the same time.
“Can Rapid breach Trailing Drawdown?”
Yes, if Trailing Drawdown is enabled on the Rapid account. Rapid may not have Daily Loss, but other risk rules can still apply.
“What happens if the market moves back after a trailing breach?”
A confirmed breach is not reversed because the market later recovers. The account state is based on the official breach condition when it was triggered.
Summary
Trailing Drawdown protects account progress by creating a moving floor below the highest equity reached. When the account reaches a new high, the trailing floor can move upward. When the account loses money, the floor does not move downward.
The most important rule is simple: stay above the trailing floor shown in your dashboard.
Trailing Drawdown follows your highest equity upward and can breach the account if live equity falls below the trailing floor.
Trailing Drawdown protects progress.
As your account reaches higher equity, the trailing floor can move up. It does not move back down when equity falls.
Confused by your trailing floor or a trailing breach?
Check your dashboard values first: highest equity, live equity, trailing limit, trailing floor, remaining buffer, and open positions. If something still looks unclear, contact support with your account number and screenshots.