DrawDown Explained
Nexgen ProTrader Funding's Draw-Down Information.
Here’s How It Works
If you're up $2,000 in an open trade but only lock in $1,300 when you close it, your maximum drawdown will move up by that $1,300.
Example:
You start with a $150,000 account and a $4,800 max drawdown. After closing a trade with $1,300 in profit, your new draw-down stop level is based on your highest closed equity: New equity high: $151,300 New stop level: $151,300 - $4,800 = $146,500
When you have a losing trade, the drawdown will remain at the same level. Each time you make NEW account total highs after closed out trades, the drawdown will trail up again.
Example of a losing trade.
If you lose $300 on the next trade, your stop level remains the same. $146,500
If the next trade you do is another $1,300, your equity high increases to $152,300, and your stop level rises to $147,500.
Your max draw-down constantly adjusts based on closed trade profits—never open equity. Unlike other firms that use trailing draw-downs on unrealized gains (especially during evaluations or when switching to live accounts), Nexgen applies the same fair and transparent draw-down rules to every account, both demo and live.
Key Points To Remember
Your max draw-down level is recalculated only when you close a winning trade. Losing trades do not adjust the drawdown level.
You cannot exceed the maximum drawdown level during a trade. If you do, the system will automatically liquidate your positions.
If your account is liquidated, you must reset it to resume trading.
Please note that on Semi-Live "Trader" or Live Protrader accounts, Nexgen offers very generous drawdowns, and the drawdown rules will remain active throughout the account's lifespan.
It is also crucial to remember that while the drawdown will never stop trailing the account, the daily stop-loss will remain active for all accounts throughout the account's life. ... The bottom line is to protect capital, yours and ours!
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