Apex Trader Funding - Eval Account

Summary

The video explains the trailing drawdown system used by Apex Trader for account funding evaluations. It defines the trailing drawdown as the maximum loss threshold that trails your highest account balance. It provides examples showing how the drawdown threshold rises when your balance hits new highs, but stops trailing once your profit goal is achieved. The partners implement this rule to ensure traders can demonstrate risk management skills by remaining aware of and keeping within their trailing drawdown limits at all times.

Takeaways

• 😀 The trailing drawdown tracks the maximum loss allowed before auto liquidation, based on account size
• 😱 Drawdowns trail the highest account balance until the initial balance plus profit goal is reached
• 📉 Larger accounts have bigger drawdowns and more room to trade
• 💰 A $100k account drawdown trails the highest balance until the $100k initial balance plus profit goal is reached
• 👛 A $50k account would start with a $47.5k drawdown limit that moves up with new high balances
• 😊 Drawdowns help traders demonstrate risk management abilities for funding
• ⏱ Once the drawdown reaches the initial balance + profit goal, it stops trailing higher
• 😕 Losses bring the account balance down but don't affect drawdown limits
• 😎 New high balances will make the drawdown trail higher again
• ⚠️ Traders should monitor their account's trailing drawdown at all times to manage risk

Q & A

What is the trailing drawdown or auto liquidate threshold value?

It is the maximum amount you can lose in the account before it gets automatically liquidated or closed. It trails your account's highest balance by a specific amount based on the account size you choose.

How is the trailing drawdown amount determined?

It is determined based on the account size you choose for evaluation. Larger accounts have a bigger drawdown amount and more room to trade.

Does the trailing drawdown keep moving up indefinitely as profits increase?

No, once it reaches your starting balance plus profit goal, it will stop trailing even if more profits are made.

In the $50,000 account example, why did the drawdown remain at $48,500 after a $1000 loss?

Because the balance of $50,000 did not exceed the previous high balance, so the drawdown level does not change.

What happens if the drawdown threshold is hit?

The account gets automatically liquidated or closed by the funding partners.

Why do funding partners use a trailing drawdown system?

To ensure traders demonstrate the ability to manage risks and maintain discipline in their trading.

How can traders avoid hitting the trailing drawdown level?

By maintaining disciplined money management rules and being aware of their drawdown at all times.

Is it possible to change the account size during an evaluation?

No, the account size is fixed when starting the evaluation.

What is the purpose of providing a profit goal?

It incentivizes traders to aim for a profit target rather than just recovering losses.

Who determines the profit goal amount?

The funding partners determine the profit goal based on the account size.