Summary
Daily Loss Limits are a risk control mechanism that helps prevent large, uncontrolled losses within a single trading day. They protect both traders and the firm by enforcing discipline and limiting exposure to excessive risk. This article explains how daily loss limits work, when they apply, and what happens if they are breached.
What Is a Daily Loss Limit?
A Daily Loss Limit is a predefined threshold that restricts the maximum amount you can lose in a single trading day. This limit is calculated based on your account size and is meant to cap risk during volatile market conditions or poor trading performance.
Account Size | Daily Loss Limit (Soft Breach) |
$25,000 | $500 |
$50,000 | $1,250 |
$100,000 | $2,500 |
$150,000 | $3,750 |
How It Works
The daily loss is tracked in real-time throughout each trading session. If your unrealized or realized losses exceed the limit, your account may trigger a soft breach warning. This does not immediately fail the account but may restrict your ability to continue trading that day or issue a compliance alert.
For plans like the Growth Plan, the daily loss limit functions as a soft safety net. It gives traders a warning to adjust behavior without immediately disqualifying the account.
When Is It Evaluated?
The system monitors your PnL continuously from the start of each trading day (6:00 PM EST to 5:00 PM EST the next day). If the threshold is breached, your dashboard will update and notify you of the violation.
You can still trade afterward depending on the plan, but breaching the limit may impact your eligibility for payouts or flag your account for further review.
Plans That Include Daily Loss Limits
Not all plans include a daily loss limit. Here’s how it varies:
Growth Plan: Has a soft daily loss limit
Elite Plan: Does not include a daily loss limit; instead uses a real-time trailing drawdown
Straight to Sim Funded: No daily loss limit; enforced through end-of-day trailing drawdown
Funded Plan: No daily loss limit; managed through trailing drawdown and compliance review
Always refer to your plan’s documentation for the most accurate risk enforcement policies.
Why It Matters
Daily Loss Limits:
Reinforce disciplined trading habits
Prevent wipeouts caused by poor single-day decisions
Allow for recovery and continuity without full account failure
These limits are part of MegaTrader’s broader commitment to funding responsible, long-term traders.
Need Help?
Have questions about your loss limit or unsure if you’ve breached it? Reach out via [email protected] or speak with us on live chat inside your portal.