Drawdown & Total Loss Rules – Nexus Funding
At Nexus Funding, we enforce strict risk management rules to promote disciplined trading and protect both traders and the firm. Below is a breakdown of our Daily Drawdown and Total Loss limits for different account types.
Two-Step Accounts
Daily Drawdown Limit
5% Daily Drawdown: Your daily loss limit is set at 5% of the starting balance or equity at the beginning of each trading day.
This means your drawdown is calculated based on your balance at the start of the day and resets daily.
Example:
Purchased account balance: $100,000
5% drawdown = $5,000
If your account starts at $102,000, your new daily drawdown threshold would be $102,000 - $5,000 = $97,000
🚨 Hard Breach: If your losses exceed 5% within a single trading day, your account will be immediately terminated.
Total Loss Limit (Static)
10% Total Loss Limit: This limit remains fixed and does not change based on account growth or decline.
Example:
If you start with $100,000, your total loss limit is $10,000.
If your balance drops to $90,000, your account will be closed automatically.
🚨 Hard Breach: Exceeding 10% total loss will result in immediate account closure.
Instant Funding Accounts
Instant Funding Accounts have a different set of risk rules due to their direct access to trading without evaluation phases.
Loss Limit SafeGuard (Maximum Risk Rule)
Traders cannot lose more than 1% of their original account balance per trade.
If a single position exceeds -1% of the account balance, the account will trigger a hard breach and be closed.
ProperRisk Limit: 1% of the account balance in realized or unrealized P&L per trade
🔹 Example:
Account balance: $100,000
1% max risk per trade = $1,000
If a trade incurs a loss of -$1,000 or more, the account will be breached and closed.
Overall Risk Limits for Instant Funding Accounts
Daily Drawdown Limit: 3% of the original account balance
Total Drawdown Limit: 5% of the original account balance (Trailing)
ProperRisk Limit: 1% of the account balance in realized or unrealized P&L per trade
🔹 Example for a $50,000 Instant Funding Account:
Daily Drawdown: $1,500 (3% of $50,000)
Total Drawdown: $2,500 (5% of $50,000)
ProperRisk Limit: $500 (1% of $50,000)
🚨 Any violation of these rules will result in a hard breach, leading to account suspension.
🔹 Trailing Total Drawdown:
The total drawdown limit in Instant Funding accounts is trailing, meaning it moves up as your balance grows, but it never resets lower.
Why These Rules Matter
These risk limits ensure traders manage their risk effectively and prevent excessive losses. By enforcing clear drawdown rules, Nexus Funding helps maintain a structured and sustainable trading environment.
Monitoring & Enforcement
Our system actively tracks all trading activity to ensure compliance with the drawdown and total loss limits. If any limit is breached, your account will be subject to immediate action in accordance with our risk management policies.
📌 Need Assistance?
For any questions regarding the drawdown rules, reach out to our support team. We’re here to help you trade responsibly and successfully! 🚀