Trailing Drawdown Calculator: Know Your Exact Risk Per Trade
Understanding your trailing drawdown is critical for passing a prop firm challenge. In this guide, we show you the exact formulas to calculate your real risk per trade.
How to Calculate Your Effective Drawdown
Your remaining drawdown buffer is the distance from your current account value to the breach level:
Remaining Buffer = Current Account Value - Breach Level
Example: Apex Trader Funding, $100K Account
- Initial breach level: $97,000
- Your balance after 3 winning trades: $97,500
- Unrealized profit on current position: +$2,000
- On an intraday trailing account, the high-water mark can pull the breach level upward during the session
- If the breach level moves to $98,000 while your balance is $97,500, you are already below the threshold
That is why intraday trailing drawdown is so unforgiving: unrealized gains can tighten the account before you bank the trade.
Risk Per Trade Formula
Max Risk Per Trade = Remaining Buffer X 0.30
We recommend risking no more than 30% of your effective drawdown on any single trade.
Example
Remaining buffer: $500 Max risk per trade: $500 X 0.30 = $150
For futures, use the correct contract multiplier. ES is $50 per point and MES is $5 per point.
- With MES and a 10-point stop, one contract risks about $50
- With ES and a 10-point stop, one contract risks about $500
