Apex Trader Funding - Eval Account

ATF

9 Feb 202401:36

Summary

TLDRThe 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.

Outlines

00:00

😊 Introduction to Trailing Drawdown for Apex Trader Funding

This paragraph introduces the concept of trailing drawdown, also known as auto liquidate threshold value, in the context of Apex Trader funding. It explains that the trailing drawdown is the maximum loss allowed in the account based on the account size chosen, with larger accounts having bigger drawdowns. An example is provided of how the trailing drawdown works for a $100,000 account, trailing the highest account balance until it reaches the initial balance plus profit goal.

😃 Example of Trailing Drawdown for a $50,000 Apex Trader Funding Account

This paragraph provides another example explaining how the auto liquidate threshold value and trailing drawdown works for a $50,000 Apex Trader funding evaluation account. It steps through an example trade scenario, showing how the drawdown level trails higher as balance reaches a new high, but does not move down with losses once the last high is reached. It explains why funding partners have this rule in place.

Mindmap

Keywords

💡Trailing draw down

The trailing draw down refers to the maximum amount the account is allowed to lose before it gets automatically liquidated or closed. It is based on the account size and trails the highest account balance achieved. For example, with a $100,000 account, if the balance reaches $120,000 at some point, the draw down will trail up to $110,000.

💡Auto liquidate threshold

This is another term for the trailing draw down. It is the point at which the account will get automatically closed if the losses exceed this threshold. It moves up when the account balance hits new highs but does not move down when the balance drops.

💡Account size

This refers to the amount of money allocated to the trader's account for evaluation purposes. Larger account sizes generally allow for bigger trailing draw downs.

💡Draw down

The draw down refers to the amount of loss from the peak account balance. Monitoring the ongoing draw down relative to the liquidate threshold is crucial for risk management.

💡Money management

This involves principles and strategies for controlling risk, such as limiting position sizes and setting stop losses. It enables traders to survive draw downs and avoid liquidation.

💡Discipline

Maintaining trading discipline, in terms of adhering to predefined risk management rules, is emphasized in the video. This discipline is required to stay within the draw down thresholds.

💡Risk management

Controlling and mitigating trading risks via money management techniques and discipline is a core theme. Remaining aware of the liquidate thresholds and draw downs is a key element.

💡Evaluation

The accounts and trading performance are evaluated against criteria such as profit targets and draw down limits. Larger accounts allow wider limits to demonstrate capacity.

💡Profit goal

This is the minimum profit target that must be achieved with the account to pass the evaluation. Reaching this goal determines the draw down trail.

💡Balance

The account balance fluctuates with wins and losses. New highs lead to increased draw down trails while draw downs reduce the balance. Monitoring it is vital.

Highlights

The trailing draw down trails your account's highest balance until it reaches your starting balance plus profit goal.

Larger accounts have bigger draw downs and more room to trade.

The draw down starts at $47,500 for a $50,000 account.

If your balance reaches a new high, the draw down trails up by the same amount.

If your balance drops, the draw down remains at the previous level.

The draw down only trails higher again once a new high balance is reached.

Once the draw down reaches the starting balance plus profit goal, it stops trailing higher.

Funding partners want traders to demonstrate risk management ability.

Traders must be aware of their trailing draw downs at all times.

Traders should keep disciplined money management rules.

The draw down trails based on achieving new high account balances.

The initial draw down level depends on the account size.

Losses do not immediately lower the trailing draw down level.

The draw down is intended to encourage prudent risk taking.

Awareness and discipline help traders avoid liquidation.