Trailing Drawdown

Know what moves the floor before you compare a firm.

10-second answer: A trailing drawdown is a loss limit that can move up as your account makes progress. The part that matters is what moves it: intraday equity, end-of-day balance, closed balance, or a rule that locks or converts after a milestone.

Which Kind Are You Looking At?

Rule shape	What moves the floor	What can trip traders up
Intraday equity trail	Open-position equity or real-time account value can move the floor during the session.	A trade can look green, pull back, and leave less room than expected.
End-of-day balance trail	The floor updates from a closing or end-of-day value named by the firm.	Ending far below the day’s best value can still matter if the rule uses the close.
Closed-balance trail	Closed profit or highest closed balance moves the floor.	Open winners may not help until they are closed, but losses can still reduce the account.
Lock or convert behavior	The floor trails until a milestone, then stops moving or becomes fixed.	The lock point, cap, and stage rules decide when the pressure changes.

Fictional Walkthrough

Illustrative only, not a real firm rule. Say a practice account starts at 100 units and has a 5-unit trailing buffer. The first floor is 95. If the value named by the rule rises to 106, the floor could move to 101. If the account later falls to 100, the account is below that fictional floor even though it is still at the original starting value.

The example only shows the moving-floor idea. It does not say whether a real firm uses equity, end-of-day balance, closed balance, a lock point, or a different breach test.

Five Things To Check In The Firm Rules

• Measurement basis: equity, end-of-day balance, closed balance, or another named value.
• Update timing: real time, end of day, after close, or after a platform/account event.
• High-water mark trigger: what value creates a new floor.
• Lock, cap, or convert behavior: whether the floor stops moving after a milestone.
• Breach consequence: what the firm’s official rule says happens if the account touches or crosses the floor.

What This Page Does Not Answer

This dictionary entry does not tell you which calculation basis a specific firm uses, whether open equity counts, whether a funded-stage rule differs from an evaluation rule, or what a specific account’s floor is today. For those details, use the Trailing Drawdown Rules page or test a scenario in the Prop Firm Drawdown Calculator.

Related BestProps Pages

• Prop Trading Dictionary
• Trailing Drawdown Rules
• Prop Firm Drawdown Calculator
• Drawdown Rules

Source, Corrections, And Disclosure

Fast source check: this definition is generic. Exact firm rules can change by program, stage, platform, and account agreement, so use the linked RuleWatch page when you need firm-by-firm facts.

BestProps uses official firm rule pages, help centers, terms, account specifications, and dated policy notices for firm-specific drawdown facts. Public chatter can point to questions worth checking, but it is not proof of a formula or breach result.

Firms can request corrections by sending the current official rule source through the BestProps contact path. This page currently has no signup links, paid placements, sponsored rows, or monetized routing. Commercial relationships, if added later, should not control this definition, source labels, corrections, or inclusion decisions.

This page is informational only. It is not trading, financial, legal, tax, payout, or account-compliance advice.