The "Profit" trading rule is set at 10% of the initial capital deposit. This rule means that the trader must make a profit of at least 10% from the initial account balance on the provided real account within a period of up to one calendar month. For example: If you are trading on an account with an initial capital of $100,000, then your profit must be $10,000 over a period of one calendar month.
The "Maximum Loss" trading rule is set at -10% of the initial capital deposit. The balance of the test account must not at any point during one calendar month fall below 90% of the initial account balance. For an account with a deposit of $100,000, this means that the least possible amount of funds in the account can be $90,000. This includes both closed and open positions. The logic for calculation is the same as for the "maximum daily loss" rule, except that it is not limited to one day but spans the entire duration of the test period. The limit includes commissions and swaps. A -10% of initial capital gives the trader sufficient room to prove that their trading strategy is suitable for investment. It acts as a capital buffer to keep the trader in the game, even if there are initial losses. The rule is designed to ensure that the trader's account cannot reduce below 90% of its value under any circumstances. These rules offer a clear set of guidelines for traders to adhere to, ensuring that both the individual trader and the brokerage firm are protected from undue risk. Moreover, they set benchmarks that traders can aim to surpass, offering an objective measure of their trading skill and risk management capabilities.
Current Daily Loss = Results of closed positions of that day + Results of open positions. For example, with an initial capital of $100,000, the maximum daily loss is $5,000. If you've lost $4,000 in your closed trades, your account should not decrease by more than $1,000 for that day. This also includes not having your open floating losses exceed -$1,000. The limit includes commissions and swaps. Conversely, if you make $4,000 in one day, you can afford to lose $9,000 but not more than that. Remember, your maximum daily loss also accounts for your open trades. For example, if you closed trades with a loss of $4,000 in one day and then opened a new trade with a floating loss of -$1,200 but ended up being positive, you've lost -$200 at some point. Consequently, your daily loss totals -$5,200, which is more than the allowable loss of $5,000. Be cautious: the maximum daily loss resets at midnight (24:00 CEST)! Let's say you made a profit of $6,000 one day. On the same day, you have an open position with a floating loss of -$8,000. The maximum daily loss for that day is not violated. The current daily loss is -$2,000 ($6,000 closed profit; -$8,000 open position). However, if you hold that position with an open loss of -$8,000 past midnight, the daily loss limit will be violated. This is because your profit from the previous day does not carry over into the new day, and the open loss of -$8,000 exceeds the maximum allowable daily loss of $5,000. This maximum daily loss rule provides enough room for the trader to trade while ensuring a clearly defined daily risk for the company. Both the trader and the company benefit from this rule, as the account value will not fall below the set limit.
On all test accounts, 1:100 leverage is available. Leverage is a service provided by the broker to each trader, in the form of lending cash or securities for trading in the market. Implications: This high leverage can magnify both your gains and losses. While it allows you to enter positions that are larger than your initial capital, it also amplifies the risk involved. Make sure you're aware of this when designing and implementing your trading strategies.
The "Positive Trading Days" rule is set at 50%. This means that you must achieve at least 50% positive days over one calendar month compared to the number of negative days. A positive day is defined as a day when the account balance at 23:59:59 UTC is higher than on the same day at 0:00:01 UTC. Implications: This rule pushes you toward consistent profitability rather than erratic trading. It encourages risk management and helps to avoid strategies that rely too heavily on big wins to offset frequent small losses.