Uprofit Trader has rules related to the end of day drawdown. They called theirs the Uprofit Pro Drawdown, but it is essentially an end of day draw down calculation. Read below for more information and an example.
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The information below was current as of the time of writing this article. Please visit Uprofit Trader and review their help section to verify all the information below is still current before signing up.
Uprofit Pro Drawdown – End of Day Drawdown
Drawdown means reduction or decrease. Applied to financial markets, it refers to the worst series of accumulated losses, i.e., the largest drop from the highest point to the lowest point on the return curve.
The drawdown gives us a broad overview of the maximum loss that a trader can bear, or the volatility that their capital has experienced in reaching the final objective.
How is the Pro Drawdown calculated?
The Uprofit Trader Pro Drawdown will only take your profits into consideration at the end of the trading day and is updated when your account balance reaches a new high at the end of any trading day.
This method of calculating the Drawdown allows Uprofit Traders to trade freely while taking advantage of trading opportunities. All this without worrying about a Trailing Drawdown that will count realized and unrealized profits. The Pro Drawdown will only take into consideration the realized profits at the end of the trading day.
You can keep track of your Pro Drawdown using your Trading Dashboard at the end of every trading day (3:10 PM CT).
Example for a 100k Uprofit Trader account:
Day 1 of trading: you have an open position balance of +$100,500 but you close your position with an account balance of $100,000. Your balance at the end of the trading day is $100,000. Your Pro Drawdown at the end of the trading day is $97,000.
Day 2 of trading: you have an open position balance of +$100,800 but you close your position with an account balance of $98,000. Your balance at the end of the trading day is $98,000. Your Pro Drawdown at the end of the trading day is $97,000.
Day 3 of trading: you do not make any trades. Your balance at the end of the trading day is $98,000. Your Pro Drawdown at the end of the trading day is $97,000.
Day 4 of trading: you have an open position balance of +$103,000 but you close your position with an account balance of $100,000. Your balance at the end of the trading day is $ 100,000. Your Pro Drawdown at the end of the trading day is $97,000.
Day 5 of trading: you have an open position balance of +$105,000 but you close your position with an account balance of $104,000. Your balance at the end of the trading day is $104,000. Your Pro Drawdown at the end of the trading day is $100,000.
Your unrealized profits are not taken into account when calculating your Uprofit Trader Pro Drawdown. This is a huge benefit to traders as it allows you to have swings in your P&L through the day and not be penalized.
- Account balance: Funds that you have available in your trading account.
- Drawdown: The maximum loss that an account can bear from the maximum Account Balance.
- Pro Drawdown: Updated only when your Account Balance reaches a new high at the end of any trading day.
- Trailing Drawdown: Always updated in real time, taking into account realized and unrealized gains (Unrealized PnL).
- Unrealized PnL: Your account’s maximum balance taking into consideration open and closed operations.
What happens if my account balance falls below the Pro Drawdown?
If your Uprofit Trader account balance falls below the Pro Drawdown at any time of the day, your account will be liquidated.
You are not allowed to take your account balance to a loss greater than the Pro Drawdown at any time during the trading day.
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Risk Disclosure:
Futures and forex trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results.
Hypothetical Performance Disclosure:
Hypothetical performance results have many inherent limitations, some of which are described below. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown; in fact, there are frequently sharp differences between hypothetical performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical performance results is that they are generally prepared with the benefit of hindsight.
In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk of actual trading. for example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all which can adversely affect trading results.
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