How does a trailing drawdown work, and why does it hurt algos?

How a trailing drawdown works

A funded-trader evaluation sets a maximum loss, which works as a floor under the account. If your equity touches the floor, the account fails. A static floor stays where it started, $2,000 below a $50,000 account for example. A trailing floor follows the account’s highest balance upward at the same distance and never comes back down. Topstep, which calls its floor the Maximum Loss Limit or MLL, sums it up in three sentences: “The MLL is a trailing limit. It rises as your end-of-day balance grows, but never moves down. Once it reaches your starting balance, it locks permanently.” (help centre)

Trailing is the norm. We counted the 35 $50K US futures evaluations in our 27 September 2026 dataset and checked them against the firms’ own pages on 30 September where we could reach them. Of the 35, 31 trail at the end of the day and 4 trail intraday, and none uses a static floor during the evaluation.

A worked example: $50K with a $2,000 trailing max loss

The numbers in this example are our own. The account locks its floor at the starting balance, as Topstep, FTMO and Alpha Futures do, and passes at $53,000, a 6% profit target.

Day	Closing balance	Highest close so far	Floor for the next day	Room above the floor
Start	$50,000	$50,000	$48,000	$2,000
1	$50,800	$50,800	$48,800	$2,000
2	$50,300	$50,800	$48,800	$1,500
3	$51,600	$51,600	$49,600	$2,000
4	$52,300	$52,300	$50,000, locked	$2,300
5	$51,400	$52,300	$50,000	$1,400

On day 2 the account gave back $500 and the floor stayed where it was, so the room shrank to $1,500. With a static limit the floor would still be at $48,000 after day 5, leaving $3,400 of room where the trailing account has $1,400. On day 4 the floor would have risen to $50,300, but it stops at the starting balance. FTMO’s rules page works through the same case: when a close of $52,500 would put the limit at $50,500, “the Maximum Drawdown Limit locks at the Initial Simulated Capital instead.”

Some firms lock $100 higher. Lucid, MyFundedFutures, FundedNext’s Flex and Rapid plans and Tradeify’s funded accounts stop the floor at $50,100, which happens once the highest balance reaches $52,100. Tradeify’s evaluations never lock. Its help centre says the drawdown locks “On Sim Funded accounts (not Evaluations)”.

End-of-day versus intraday trailing

With end-of-day trailing, the floor moves once a day, from your closing balance. You can still fail during the session, because most firms check the floor in real time against your equity, open losses included. Tradeify says its limit “updates at end of day but is enforced in real time against your net liquidation value”, and at Topstep “Both realized and unrealized P&L count toward it.”

Intraday trailing moves the floor during the session as well, from your highest equity, open profit included. Take Profit Trader’s PRO accounts work this way. Its help centre gives an example for a $25,000 account with a $1,500 drawdown: “If unrealized profit reaches $1,000, your minimum account balance rises to $24,500 in real time. If you close the trade with a $500 realized gain, your balance becomes $25,500, but your minimum remains $24,500.” The trader made $500 and finished the trade with $500 less room than they started with.

Apex and Lucid charge more for the end-of-day version. On 27 September 2026, Apex listed its 50K Intraday Trail evaluation at $249 and its EOD Trail evaluation at $590, and Lucid priced LucidDaily at $138 with an intraday evaluation drawdown and $166 with an end-of-day one. Alpha Futures goes the other way and says “None of our accounts utilize intraday trailing drawdown you will see elsewhere in industry.”

Why intraday trailing hurts algos that scale in and out

An algo that builds a position in steps, takes part of its profit and holds the rest will see its open profit rise and fall several times a day. Under intraday trailing, each new equity high lifts the floor for good, whether or not the algo ever banks that profit. A trader asking about this on r/algotrading in November 2025 wrote that “the trailing drawdown of prop firms would quickly blow my account if the algo was in a position whilst price moved up & down.”

Our own example, again on $50K with a $2,000 limit, shows one session under each rule.

Time	What the algo does	Equity	Intraday floor	End-of-day floor
09:30	Starts flat	$50,000	$48,000	$48,000
10:30	Scales in, and open profit reaches $1,500	$51,500	$49,500	$48,000
13:00	Takes a third off as price pulls back	$50,200	$49,500	$48,000
14:30	The pullback deepens	$49,450	Breached	$48,000
16:00	Price recovers and the algo closes out	$50,100	Account already failed	$48,100 from the next day

Under intraday trailing the account fails at 14:30, $550 below its starting balance, because a profit it never banked had lifted the floor to $49,500. Under end-of-day trailing the same day closes $100 up with $2,000 of room. The same thing happens to any algo whose open profit swings, including market-making and mean-reversion strategies that hold inventory through small moves.

Why firms use trailing drawdowns

Firms don’t explain the choice on their rules pages, so this is our reading. At most firms the funded account is simulated, and the firm pays payouts out of its own revenue. A floor that follows the high closes accounts that make money and then give much of it back, before those gains turn into payouts. Once the floor locks at the starting balance, a funded trader can only lose profit already made. The higher price of the end-of-day versions suggests the firms know intraday trailing is the harder rule to trade under.

Drawdown type by firm

We read each firm’s rules on 30 September 2026, except where marked. Prices for these plans are on our page about what an evaluation costs.

Firm	Plans	Evaluation	Simulated funded account	Where the floor stops	Source
Topstep	Trading Combine, Express Funded Account	End of day	End of day	Starting balance. The funded account starts at $0 and locks at $0	Maximum Loss Limit
FTMO	Futures Growth, Pro	End of day	End of day	Starting balance	Rules
Alpha Futures	All	End of day	End of day	Starting balance	MLL
FundedNext	Futures Legacy	End of day	End of day	Starting balance	MLL
FundedNext	Futures Flex, Rapid Pro, Rapid Daily	End of day	End of day	Starting balance + $100	MLL
Lucid Trading	LucidPro, LucidFlex	End of day	End of day	Starting balance + $100	LucidPro, LucidFlex
Lucid Trading	LucidDaily	End of day or intraday, chosen at checkout	Intraday	Starting balance + $100	LucidDaily
MyFundedFutures	Builder, Rapid EOD, Pro	End of day	End of day	Starting balance + $100. On Pro’s funded account, after the first payout	Builder, Rapid EOD, Pro
MyFundedFutures	Rapid	End of day	Intraday	Starting balance + $100	Rapid
Take Profit Trader	Trading Test, PRO	End of day	Intraday	Starting balance	Test, PRO
The5ers	Futures Day Trade, Swing	End of day	End of day	Not stated	FAQ
Tradeify	Growth, Select	End of day, enforced in real time	End of day	No lock in the evaluation. Funded: starting balance + $100, or at the first payout request	Drawdown rules
Apex Trader Funding*	Intraday Trail	Intraday	Intraday	Funded: starting balance + $100	Help centre
Apex Trader Funding*	EOD Trail	End of day	End of day	Funded: starting balance + $100	Help centre

*Apex’s help centre blocked our automated check on 30 September 2026. Its rows show what we recorded on 27 September 2026.

Loss limits in ROMER’s planned terms

ROMER’s planned terms, which may change, set a 6% profit target, a 4% trailing max loss and a 2% daily loss limit, so the $50K Pro plan would carry a $2,000 trailing max loss and a $1,000 daily limit. ROMER, our funded-trader program, allows bots, algos and HFT, and every algo runs on our hardware inside the exchange’s data centre. The simulated evaluation lasts at least 3 trading days. An algo that passes it must pass again in Verification over at least 10 new trading days, with fills still simulated, and the best algos then go on to trade our own capital. Funding isn’t guaranteed.