Trailing vs Static Drawdown: The Rule That Ends Most Accounts
Two accounts with the same 10% drawdown can fail at completely different prices. The difference is whether the floor stays where it started or follows your balance up. Here is how each works, with your exact fail line.
A static drawdown is measured from your starting balance and never moves, so profit adds room. A trailing drawdown is measured from the account's highest value, so the fail line rises as you make money and you can breach it while flat overall. Trailing comes in end-of-day, intraday and locked variants, and the variant matters as much as the percentage.
Where is my fail line?
Static floor = starting balance − drawdown. Trailing floor = highest balance − drawdown (firms differ on whether the drawdown is a percentage of the starting size or of the peak, and on whether it locks once you are in profit — check your own account's terms).
Which drawdown type each firm uses
Static drawdown
A static (or absolute) maximum drawdown is measured from your starting balance and does not move. On a $100,000 account with a 10% static drawdown, the floor is $90,000 for as long as you hold the account. Profits give you more room, because the floor stays still while the balance rises.
Trailing drawdown
A trailing drawdown is measured from the highest value the account has reached, so the floor follows you up. Make $5,000 on that same account and the floor rises to $95,000. Give the $5,000 back and you are at the floor even though you are still at your starting balance. This is why traders who "gave it all back" fail accounts they were never actually down on.
Trailing rules come in variants, and the variant matters as much as the number:
- End-of-day trailing: the floor is recalculated once a day from the closing balance, so intraday spikes do not move it.
- Intraday trailing: the floor follows unrealised profit tick by tick, so a position that goes well and then reverses can raise your fail line before you ever close it.
- Locked trailing: the floor trails only until it reaches a set level (often the starting balance), then stops.
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Play free, no signup →What this changes about how you trade
- Taking profit off the table matters more under a trailing rule. Round-tripping a winner costs you room, not just profit.
- Your real risk budget is the distance to the floor, not the headline percentage. The calculator above works that out for you.
- Position size has to come from that distance. Use the lot size calculator with the remaining buffer as your account figure, not the nominal balance.
- Know when the floor updates - at the close, or on every tick. It changes whether holding a floating winner overnight is safe.
Which is harder?
Static is more forgiving for a trader who grows an account and then has a bad week, because the floor never rose. Trailing is stricter by design, and intraday trailing is the strictest of the three. Neither is "better" - they are different constraints, and the mistake is assuming the one you are used to is the one you have.
Frequently asked questions
What is the difference between trailing and static drawdown?
A static drawdown is measured from the starting balance and never moves. A trailing drawdown is measured from the account's highest value, so it rises as you make profit and can put you at your fail line even when you are flat overall.
Does trailing drawdown include open profit?
It depends on the firm and the program. Intraday trailing rules follow unrealised profit tick by tick; end-of-day rules only update from the closing balance. Check the exact wording of your account's terms.
Which drawdown type does each firm use?
The table on this page is read live from our own compliance configuration, and anything we could not confirm from a firm's own current terms is shown as Verify instead of a guessed number.
Why do so many accounts fail on this rule?
Because the floor can move while the trader is thinking in terms of their starting balance. Knowing which type you have, and where the floor is right now, is the whole defence.
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