The maximum daily loss is the amount you are allowed to lose in a day. The higher of two values — equity or balance — is used in the calculation. The rule is set as a percentage of the starting capital or balance for each day. Your equity for the day is the result of your current floating PnL (profit and loss), including all positions closed that day — it must not reach the maximum daily loss limit. The daily limit resets at 00:00 every day.

Example 1: equity is higher than balance at the start of the day.

At the start of the fifth day, your account balance is $105,000 and your equity is $107,000. The daily limit is 5% of equity, as it is higher:

Daily loss = $107,000 × 5% = $5,350 — the daily loss limit.

This means your equity cannot fall below $107,000 − $5,350.

Daily loss limit = $101,650 on day 5. If your equity falls below $101,650 at any point on the fifth day, your account will be closed.

Example 2: balance is higher than equity at the start of the day.

At the start of the seventh day, your account balance is $100,000 and your equity is $99,000. The daily limit is 5% of balance, as it is higher:

Daily limit = $100,000 × 5% = $5,000 — the daily loss limit.

This means your equity cannot fall below $100,000 − $5,000.

Daily loss limit = $95,000 on day 7. If your equity falls below $95,000 at any point on the seventh day, your account will be closed.