Important Update: Changes to Drawdown Calculation & Payout Rules
Effective Date: February 1, 2026 | Category: Company News
DearTraders,
We are writing to inform you of upcoming updates to our trading objectives, specifically regarding the Daily Drawdown calculation and Payout rules. These changes are designed to standardize risk management across our platform.
Who is affected?
- All new accounts purchased on or after February 1, 2026.
- Existing accounts that progress to a new phase (e.g., moving from Challenge to Funded) after this date.
- Note: Currently active accounts will NOT be affected until they advance to the next phase.
1. New Daily Loss Limit Calculation
The Daily Loss Limit resets every day at 5:00 PM EST. The key change is in how the base value for this limit is determined.
Starting February 1st, the limit will be calculated based on the GREATER of:
- The prior day’s End-of-Day Balance (Closed P&L only).
- The prior day’s End-of-Day Equity (Balance + Open P&L).
This approach ensures that unrealized gains (open profit) at the end of the trading day are properly reflected when determining the allowable loss for the following session.
📝 Practical Example
Consider a $100,000 account with a 5% Daily Loss Limit.
At the 5:00 PM EST reset:
- Balance: $100,000
- Open Floating Profit: +$2,000
- Total Equity: $102,000
Since Equity ($102,000) is higher than Balance, the Daily Loss Limit is calculated based on Equity.
5% of $102,000 = $5,100.
Your breach level for the next day: $102,000 – $5,100 = $96,900.
(Previously, or if you had no open positions, the limit would have been based on the $100,000 balance, resulting in a breach level of $95,000).
2. Max Drawdown (Static)
The Maximum Drawdown remains initially set at 6% and is STATIC. It is calculated based on your Closed Balance and does not trail your equity as the account grows.
Example: On a $100,000 account, your maximum drawdown limit is $94,000. If you grow the account to $102,000 (closed balance), your hard breach level remains locked at $94,000, giving you more breathing room as you profit.
3. “Lock Upon Payout” Rule
For funded accounts, a “Lock Upon Payout” feature will be enabled by default.
When you successfully process a payout:
- The Max Drawdown level will permanently lock at your original Starting Balance.
- From that point forward, your account balance must not fall below the initial account size.
💡 Optional Add-on
Traders who prefer more flexibility can elect to disable this feature by purchasing an add-on (25% of the challenge price) at the checkout.
4. Withdrawal Policy Reminder
Your first withdrawal can be requested at any time, subject to an 80/20 profit split. Subsequent withdrawals can be requested every 30 days.
Critical: Please note that requesting a withdrawal does not reset your drawdown limit. If the “Lock Upon Payout” rule applies and you withdraw all your profits down to the starting balance, you will have zero drawdown buffer remaining. Withdrawing all profits will result in a violation of the Maximum Drawdown rule and loss of the account.
Updated FAQ & Support
We are updating the FAQ section on your dashboard and our website to reflect these changes. We strongly encourage you to review these details before starting a new challenge after February 1st.
Should you have any questions or require further clarification regarding these changes, please do not hesitate to contact our support team.
The Investiqa Team
