What is a trailing end-of-day drawdown and how is it calculated?

Your account has a floor. With a trailing end-of-day drawdown, that floor is your highest end-of-day balance minus the drawdown amount. The floor is recomputed once a day, at the daily close: if the day closed at a new high, the floor moves up by the same amount. It never moves down, and it never moves during the day.

1. 1
   Start at $25,000 with a $2,000 drawdown: the floor is $23,000.
2. 2
   Close a day at $25,800: the floor becomes $23,800.
3. 3
   Lose $1,200 the next day and close at $24,600: the floor stays at $23,800. It only ever rises.
4. 4
   Your equity, open positions included, is compared with the floor every few seconds. The moment it is below the floor, positions are closed and the evaluation is over. A floating loss counts; you do not get to the close.

On a funded account with a trailing drawdown, the floor never rises above your starting balance. It trails up until it reaches the balance you started with, then stops there for the life of the account: once you are in profit overall, the drawdown can only ever close you if your equity falls back below your starting balance.

Some experiments use a static drawdown instead. See the next question.