Martingale on a Funded Account: Allowed, 3 to 6 Steps

What martingale and DCA mean on a futures account

Martingale means raising your position size after each losing trade, most often by doubling it, so that a single winner pays back everything lost since the ladder began. Each rung is a new trade with its own stop and target.

DCA, short for dollar cost averaging, means adding to a position that is already open while price moves against it, which pulls your average entry toward the market. It happens inside one trade. Phoenix treats the two as separate things, and each has its own cap arithmetic.

A contract is one unit of a futures product. A mini is the full-size contract and a micro is a tenth of it. The cap counts contracts, and a cap written as 1 mini or 10 micros means one or the other, never the two added together.

Is martingale allowed on Classic, Daily, Spark and Merit?

Yes, at every stage of the account, as long as the sizing happens inside one account. The Help Center entry on prohibited strategies lists martingale and DCA among the strategies allowed on every account, beside news trading, scalping and copy trading between your own accounts.

• Classic: allowed in the evaluation and when funded. The cap grows with profit on all three sizes.
• Daily: allowed, with no scaling plan, so the full cap applies from day one.
• Spark: allowed, again with the full cap from day one and no scaling plan.
• Merit: allowed during the 30 calendar day assessment. A human decides on live funding, and funding is not promised at any result.

How a martingale ladder adds up

Take a ladder that opens with 1 contract and doubles after every loss. The sizes run 1, 2, 4, 8, 16, 32. Call the loss on the opening position one stop. If every step uses the same stop distance, the losses stack to 1, 3, 7, 15, 31 and 63 stops, each total one more than double the last.

Read the other side of that chart. A win on any step pays back every loss before it and nets exactly one stop, provided the target sits as far from entry as the stop does. Every rung puts everything lost so far at risk again, and the prize for getting through is one stop.

Now set the ladder against a drawdown. Suppose one stop costs a tenth of it. That is an illustration, not a recommendation: use your own stop.

On that account the fourth loss ends the ladder, and the account with it. The cap does not matter once the floor is reached. A ladder is over at whichever comes first, the cap or the floor, and fees and slippage on every rung push the real total a little above these counts.

How many martingale steps fit under the contract cap

The cap limits the size of a step, not the number of losses you can take. Doubling from one micro, the sizes run 1, 2, 4, 8, 16, 32, and the next step exists only if it still fits under the cap. A cap of 6 micros fits 3 steps, because 8 is over. A cap of 60 fits 6, because 64 is over.

Caps are alternatives, so work the ladder in the unit you trade. This answer on contract caps explains how they work. Below, every account is counted at the top of its range, once in micros and once in minis.

Where the drawdown ends the ladder first

Your drawdown is the room between your balance and the floor, and every step in the ladder spends it. The drawdown type decides when the floor moves. Classic and Daily trail end of day, in the evaluation and when funded. Spark trails end of day in the evaluation, then trails intraday once funded.

During the 30 calendar day assessment, Merit has no trailing floor: it carries a 25% dynamic daily drawdown and a static total loss limit of $2,000. On Classic, Daily and Spark the trailing floor stops moving at your starting balance, and profit above that level adds to your room.

The trailing drawdown is $1,500 on Classic Starter, $2,000 on Classic Growth and $3,000 on Classic Scale. It is $600 on Daily Seed, $1,500 on Daily Starter and $2,000 on Daily Growth, and $400 on Spark Seed and $1,000 on Spark Starter.

Work it backwards. Divide your drawdown by what one stop costs to count the stops of room you have. The two accounts below show it at one stop size.

On Classic Starter, $1,500 is 30 stops of room. Four losses cost 15 and fit, but the 15 micro cap has no room for a fifth rung of 16, so the cap ends the ladder at four rungs.

On Spark Starter, the same stop makes $1,000 into 20 stops of room. The 20 micro cap does fit a fifth rung of 16, but four losses already cost 15 and a fifth takes the total to 31, so the floor ends the ladder during rung five.

How DCA differs from a martingale ladder

DCA adds to the same trade instead of opening a new one after a loss. The cap is a ceiling on position size, so every add counts toward it, and a DCA plan has to fit under the cap in total. On a 10 micro cap, the first entry and every add can never exceed 10 micros between them.

A DCA plan needs numbers you set before the first entry: how many adds, how big each is, and where the whole position closes if price keeps going. Without that last number the plan has no end, and the floor supplies one for you.

What changes when you hold more than one account

Martingale sizing and DCA stay open inside one account, and holding several accounts is fine. The line the Help Center draws is between accounts. Re-entering the same trade on another account after one is stopped out, or trading bigger on the next account to win back what the last one lost, counts as martingale across accounts.

That rule covers your other Phoenix accounts and accounts at other firms, so keep each ladder inside the account it started on.

Work out your own ladder in four steps

1. Find your capRead the contract cap for your account and pick one unit, minis or micros.
2. Count the stepsDouble from your opening size until the next step would pass the cap.
3. Price one stopWork out what your opening position loses at your stop, fees included.
4. Divide the roomDivide your drawdown by that cost, then compare the result with 1, 3, 7, 15, 31 and 63.

Whichever count is smaller, the cap's or the floor's, is how many rungs your ladder really has.