Summary
Trailing Max Drawdown (TMD) is a core risk control used across all MegaTrader account types. It is designed to protect against excessive downside risk while encouraging disciplined, sustainable trading.At MegaTrader, every plan uses an End-of-Day (EOD) trailing drawdown model. There are no intraday or real-time trailing drawdowns on any plan.This article explains how the EOD drawdown works, why it is used, and how it applies across plans—listed in the correct plan order.
What Is Trailing Max Drawdown?
A Trailing Max Drawdown is a dynamic loss limit that increases as your account reaches new profit highs. Unlike a fixed drawdown, it adjusts upward based on performance, helping lock in gains while still allowing room for normal market movement.
If your account balance falls below the active drawdown level, the account is marked as failed. Understanding when the drawdown updates is critical to managing risk correctly.
End-of-Day (EOD) Drawdown Explained
Under the End-of-Day model, the trailing drawdown is evaluated only after the trading day has closed. Intraday equity highs, unrealized profits, or temporary balance spikes do not move the drawdown during the session.
How the EOD Model Works
The drawdown remains fixed throughout the trading day
Intraday gains do not tighten the drawdown
The drawdown updates only if the account closes at a new high
Any adjustment becomes active on the next trading day
Example
Starting balance: $100,000
Trailing drawdown: $97,000
Intraday peak: $102,000 → drawdown remains $97,000
End-of-day close: $101,500 → drawdown updates based on the closing balance
New drawdown applies starting the next trading session
This structure prevents account failures caused by short-lived volatility or unrealized intraday profits.
Which Plans Use End-of-Day Drawdown?
All MegaTrader plans follow the same EOD trailing drawdown framework, listed below in official plan order:
Plan | Drawdown Type |
Zero Plan | End-of-Day (EOD) |
Growth Plan | End-of-Day (EOD) |
Prime Plan | End-of-Day (EOD) |
Funded Plan | End-of-Day (EOD) |
There are no exceptions to this rule across any MegaTrader plan.
Why MegaTrader Uses an EOD Drawdown Model
The End-of-Day model is intentionally designed to support realistic trading behavior and long-term consistency. Real-time trailing drawdowns can penalize traders for normal intraday swings, especially during volatile market conditions.
Using an EOD drawdown allows traders to:
Trade without fear of instant drawdown tightening
Hold positions through normal intraday pullbacks
Focus on execution and risk management rather than moment-to-moment equity
Operate with clearer, more predictable risk limits
This mirrors how professional risk desks evaluate performance—based on daily results, not temporary intraday fluctuations.
Common Misunderstandings
“My intraday high moved the drawdown.”
❌ False. Only the end-of-day closing balance is used.“Unrealized PnL affects my drawdown.”
❌ False. Only realized, end-of-day balances matter.“The drawdown moves during the session.”
❌ False. It updates once per day, after market close.
Why This Matters
Misunderstanding drawdown behavior is one of the most common reasons traders unintentionally fail accounts. Knowing that MegaTrader uses a strict End-of-Day trailing drawdown allows you to plan trades with confidence and avoid unnecessary risk.
Always manage your risk based on your end-of-day balance, and regularly review your dashboard to stay aligned with your active drawdown level. A clear understanding of this rule is essential for long-term success across all MegaTrader plans.