How do you calculate the 10% Maximum Drawdown?

At MyFundedCapital, we use a 10% Trailing Drawdown, calculated based on your closed balance (not equity).

Here’s how it works:

  • Your Trailing Drawdown starts 10% below your starting balance.

  • As your account grows, the drawdown trails your highest closed balance.

  • Once your closed balance reaches a 10% profit, the drawdown stops trailing and locks at your initial balance.

  • This gives you more freedom in your trading once you’ve proven consistency.

Example:

  • You start with a $100,000 account.

  • Your maximum drawdown at the start is $90,000 (10% below).

  • You grow your closed balance to $102,000 – your drawdown moves up to $91,800.

  • You keep growing and hit $110,000 in closed balance. Now you’ve hit the 10% profit mark.

  • At this point, the drawdown locks at $100,000 — your original balance.

  • From here on, you’ll only violate the rule if your equity drops to $100,000 or lower, regardless of how high your account goes.

⚠️ Keep in mind: You still need to respect the Daily Drawdown rule of 5%, based on the previous day’s equity.