Glossary
What is Static drawdown
An overall limit whose floor stays put from the starting balance and does not rise with your profit, unlike the floor of a trailing drawdown limit.
How it works
Example
A $100,000 account, an 8% limit = $8,000, floor $92,000 for good. After a rise to $110,000 the room is 110,000 − 92,000 = $18,000. A trailing floor would sit at $102,000, room $8,000.
Common mistake
Changing risk after a profitable week without checking the floor type: with a static one the room grows, with a trailing one it does not.
Read next
Related terms
Frequently asked questions
- Where can I learn Static drawdown step by step?
- In the Trading OS Academy: “Daily stop”.
- What is Static drawdown related to?
- Max loss limit (prop); End-of-day drawdown; Drawdown.
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