Daily Loss Limit Explained With Real Numbers
The daily loss limit is the rule that surprises new traders the most. It is simple once you see it with numbers.
What it means
Your daily limit is a percent of your equity at the start of the trading day. Losses you have closed and losses on open trades both count. The limit resets at the platform's daily reset time.
An example
You have a $100,000 Two Step with a 5% daily limit.
You start the day with $100,000 equity. Your limit is $5,000, so your equity must stay above $95,000 that day.
If you close a $3,000 loss and an open trade is down $2,000, you have reached $95,000. The account is breached, even if that open trade would have recovered.
The trap
Traders look at closed trades and think they are safe. Floating loss counts too. Always check your equity, not your balance.
Daily limits by model
| Model | Daily loss |
|---|---|
| Two Step | 5% |
| Two Step Pro | 3% |
| One Step | 3% |
| One Step Static | 3% |
| Pay After You Pass | 3% |
Four habits that keep you safe
- Use a stop loss on every trade.
- Stop for the day at half of the limit.
- Add up the risk of all your open trades. Three trades at 1% are 3% of risk.
- Do not trade to win back a loss. Come back tomorrow.
Check your own numbers with the profit calculator, or read the term in our glossary.