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Max. Drawdown (End-of-Day) | IQ Capital Help Center
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▸Version 2September 16, 2026, 5:07 PM+55−10
Changes shown against Version 1.
How does the maximum drawdown work?
The maximum drawdown is adjusted daily after the New York close (EOD, approx. 5:15 PM EST). If your equity falls below this limit, the account will be closed.
The maximum drawdown trails your account balance until the initial balance of $10,000, $50,000, $100,000, or $200,000 is reached. Once this level is reached, the drawdown remains fixed permanently.
In Funding, the drawdown is adjusted to the starting balance after a Performance Reward payout and remains fixed at that level permanently.
Section: Phase 1: Before the limit freezes
− Example (100K Account)
+ Phase 1: Before the limit freezes
+ Drawdown is trailing first.
+ - The drawdown amount stays fixed: 6% of starting balance
+ - The drawdown limit sits 6% below your highest end-of-day equity
+ - The limit only moves up
+ - The limit never moves down
+ Example: 100K account
Starting balance: $100,000
Section: Example: 100K account
− Max drawdown (6%): $6,000 → Initial max drawdown level: $94,000
− Day 1 (Profit)
+ Max drawdown (6%): $6,000
+ Initial drawdown limit: $94,000
+ Day 1 (profit)
End-of-day equity: $102,000
− →New drawdown level: $96,000 ($102,000 - $6,000)
− Day 2 (Loss)
+ New drawdown limit: $96,000 ($102,000 − $6,000)
+ Day 2 (loss)
End-of-day equity: $100,500
− →Drawdown level remains at: $96,000 (The limit does not move downward after losing days)
− Day 3 (Profit)
+ Drawdown limit stays at $96,000
+ It is not adjusted downward.
+ Day 3 (profit)
End-of-day equity: $103,000
− →New drawdown level: $97,000 ($103,000 - $6,000)
− Important:
− The drawdown level only increases when a new equity high is reached and does not decrease after losing days.
+ New drawdown limit: $97,000 ($103,000 − $6,000)
+ Phase 2: After the first performance reward
+ The first payout is capped at $1,500.
+ After that, the drawdown limit is moved to the starting balance and freezes there.
+ From that point:
+ - Drawdown limit = starting balance
+ - On a 100K account it stays at $100,000 permanently
+ - The buffer is no longer 6% below current balance
+ - Available buffer = current equity minus starting balance
+ - That is simply the profit still left on the account after the payout
+ If equity falls to or below starting balance, the account is closed.
+ Example: 100K account after the first payout
+ Equity before the payout is $103,000.
+ You withdraw the maximum first payout of $1,500.
+ - Equity after payout: $101,500
+ - Drawdown limit: $100,000 (frozen at starting balance)
+ - Available buffer: $1,500
+ - Not $6,000. Not 6% of $101,500.
+ If equity later rises to $106,000 with no further payout:
+ - The limit stays at $100,000
+ - Available buffer: $6,000
+ After the first payout, the limit no longer trails upward.
+ Quick comparison
+
Drawdown amount 6% of starting balance only the remaining profit Drawdown limit highest EOD equity minus 6% fixed at starting balance Limit moves up yes no Limit moves down never never First payout not taken yet maximum $1,500 Account closes when EOD equity is below the trailing limit EOD equity is at or below starting balance
| Before the first payout | After the first payout |
|---|
+ Common mistakes
+ Wrong: “My drawdown is always 6% below my current balance.”
+ Right: That only applies before the limit is frozen, and only against the highest end-of-day equity.
+ Wrong: Drawdown and drawdown limit are the same thing.
+ Right: Drawdown is the distance. The limit is the equity level at which the account ends.
+ Wrong: After the first payout I have $6,000 of room again because this is a 100K account.
+ Right: After the payout you only have as much room as the profit left on the account.
+ Wrong: The Challenge works differently.
+ Right: The drawdown logic is the same in Challenge and Funded. A payout and the freeze to starting balance happen once the first withdrawal is made.
+ The limits in your dashboard always take priority. Percentages and account sizes can differ by product line (Crypto/CFD or Futures).
SHA-256 1f4d349b394e5c3fa895c933588f52ecce022a63f926b510441fc58768b4539b
▸Version 1July 26, 2026, 1:09 PM
First archived version.
How does the maximum drawdown work?
The maximum drawdown is adjusted daily after the New York close (EOD, approx. 5:15 PM EST). If your equity falls below this limit, the account will be closed.
The maximum drawdown trails your account balance until the initial balance of $10,000, $50,000, $100,000, or $200,000 is reached. Once this level is reached, the drawdown remains fixed permanently.
In Funding, the drawdown is adjusted to the starting balance after a Performance Reward payout and remains fixed at that level permanently.
Example (100K Account)
Starting balance: $100,000
Max drawdown (6%): $6,000 → Initial max drawdown level: $94,000
Day 1 (Profit)
End-of-day equity: $102,000
→New drawdown level: $96,000 ($102,000 - $6,000)
Day 2 (Loss)
End-of-day equity: $100,500
→Drawdown level remains at: $96,000 (The limit does not move downward after losing days)
Day 3 (Profit)
End-of-day equity: $103,000
→New drawdown level: $97,000 ($103,000 - $6,000)
Important:
The drawdown level only increases when a new equity high is reached and does not decrease after losing days.
SHA-256 23eb6bea5dc0bbeca9f1c743d2c8d12476086671b43db156cc0492b63e52277f