Static Drawdown
A fixed maximum loss limit calculated from your starting account balance that never changes regardless of profits made.
What is Static Drawdown?
Static drawdown (also called absolute drawdown or total drawdown) is a hard floor set from the moment you start your account. It never moves, even if your account grows significantly.
Example
- $100,000 account with 10% static drawdown = $10,000 max loss
- Your drawdown floor is permanently set at $90,000
- Even if you grow to $130,000, your account only gets stopped out if it drops below $90,000
Static vs. Trailing
| | Static | Trailing | |---|---|---| | Floor | Fixed from start | Moves up with profits | | Risk of loss | Decreases as you profit | Can remain high even after gains | | Used by | Most Forex CFD firms | Most Futures firms |
Static drawdown is generally considered more trader-friendly for experienced traders who are confident in growing their account.
How Firms Apply This Rule
FTMO, FundedNext, and most Forex prop firms use static (absolute) drawdown. The floor is set at account start and never changes.
Related Terms
Trailing Drawdown
A drawdown limit that moves up as your account balance increases, locking in a higher floor rather than staying fixed from the start.
Daily Drawdown
The maximum amount you are allowed to lose within a single trading day before your account is automatically suspended.
Maximum Drawdown
The overall loss limit from your starting balance (or peak balance) that, if hit, terminates your account permanently.