For traders participating in the Evaluation, Express, and Stellar 2-Step challenges, a daily drawdown of up to 5%, and for the Stellar lite challenge a daily drawdown of up to 4% of their initial account balance is permitted. However, for traders enrolled in the Stellar 1-Step challenge, the allowable daily drawdown is limited to 3% of their initial account balance.

You can use the following formula to simply calculate your drawdown limit for the day: Daily loss limit = (Your initial balance *Daily Loss Limit Percentage of your enrolled challenge)

Example 1: You have a Stellar 2-Step challenge $100,000 account and your daily loss limit is 5% of your initial balance. So, $100,000 is considered as the initial balance. So, your daily drawdown will be ($100,000 * 0.05) = $5000

Example 2: Let’s say you are in profit at a certain time in the day, you can calculate your drawdown limit for the day: (Your initial balance * 0.05 + Profit amount)

You have a Stellar 2-Step challenge $100,000 account, on noon GMT+3 server time you have made $102,100, so your daily drawdown for that day will be ($100,000 * 0.05+ $2100) = $7100. In other words, if you lose more than $7100 on Closed or Running trades on that day, you will violate the daily drawdown limitation. ** Another thing to keep in mind is that your daily loss limit will be reset at midnight according to the server time.**

Let's consider an example to illustrate this calculation. Suppose you have purchased an Evaluation 100K account. Here's how the calculation works:

**Case 01:**

For example, if you have a $100,000 account, the maximum daily loss limit is $5,000, and you are not allowed to lose more than $5,000 on any given day. Suppose you have lost a total of $3000 in your closed trades. In such a case, you cannot lose more than $2000, including floating losses. Note that swap and commission rates are included in this calculation. It will be considered a violation if you lose more than $2,000.

**Case 02:**

Similarly, let's say you gained $5,000 in profit in a single day. In such case, you will be allowed to lose $5,000 (your profit) + $5,000 (your daily loss limit) = $10,000. Losing more than $10,000 (in both open and closed positions) will be considered a violation.

**Case 03:**

Let's look at another case: You have a $100,000 trading account. In a single day, you encounter a significant loss, which is around $3,000. Determined to be profitable, you initiate another trade. At any given moment, the position shows a floating loss of -$2,100. You will breach the daily loss limit as you have crossed $5,000 for a single day.

The rule of Daily Loss Limit implies that if your trades (even floating loss ) exceed -$5,000 within any trading day, it's violating the rule. Therefore, regardless of the outcome of your last trade, hitting the $5,000 loss threshold ends your trading journey.

**Case 04:**

Another thing to keep in mind is that your daily loss limit will be reset at midnight according to the server time. For example, suppose you have gained a $2000 profit in a closed trade, and trade is currently running at a $6,000 floating loss. In this case, you still have not violated your daily drawdown for the day because your current daily loss is +$2000 - $6000= -$4000. However, if you hold this one trade with a floating loss of $6,000 after midnight, you will breach the daily loss limit because a new day begins after midnight, and you have already lost $6000, which is more than your daily loss limit of $5000.