Glossary
The terms used across the comparison.
- Evaluation (challenge)
- A paid simulated account: hit the profit target without touching the max drawdown to earn a funded account.
- Instant funding
- No challenge: you pay more and start directly on a (sim) funded account, often with a consistency rule and capped early payouts.
- Max drawdown
- The maximum loss allowed from the reference point. Exceed it and the account is closed.
- Intraday trailing drawdown
- The loss threshold follows the real-time equity high, including unrealized gains during a trade. The strictest kind: a trade that reaches +$1,000 then returns to 0 still raised the threshold.
- EOD (end of day) trailing drawdown
- The threshold only follows each day’s closing balance. Unrealized gains during the session do not count.
- Static drawdown
- The threshold is fixed relative to the starting balance and never moves. The simplest kind.
- Trailing locks
- At many firms the trailing stops once it reaches the initial balance (sometimes +$100). Beyond that it is effectively static.
- Daily loss limit (DLL)
- Maximum loss per day. “Soft”: positions are closed and trading pauses until the next day. “Hard”: the account is closed.
- Consistency rule
- No single day may exceed X% of total profit (e.g. 30% or 50%). Prevents passing a challenge on one lucky trade; on funded accounts it delays payouts.
- Minimum trading days
- Number of days (often with a minimum gain per day) required before passing the challenge or before a payout.
- PA / Sim funded
- A simulated funded account: the firm pays profits out of its own pocket, but orders never reach the real market. Most futures firms work this way.
- Live
- An account on real capital at a broker, usually after a sim phase and a payout track record.
- Activation fee
- A fee paid after passing the challenge to open the funded account (one-time or monthly).
- Reset
- Start a failed challenge over at a reduced price without waiting for the next billing cycle.
- Profit split
- The trader’s share of profits. Often 100% of the first few thousand, then 80–90%.
- Buffer / safety net
- The amount that must remain in the account after a payout (e.g. initial balance + drawdown). Reduces what you can actually withdraw.
- Scaling plan
- The number of allowed contracts grows with the account balance.
- Target / DD
- Profit target ÷ max drawdown. The lower it is, the more achievable the challenge (e.g. 1.2 vs 2.0).