Trailing drawdown (intraday)
Also called: Intraday trailing drawdown, Max trailing drawdown, MLL, Trailing threshold
In short. A trailing drawdown is a loss limit that follows the account's highest balance: it rises as the account makes new highs and never comes back down. Intraday trailing means it moves with the unrealised peak of open trades, so a trade that goes +$800 then closes flat has lifted the limit by $800 for good.
Example: 50K account, $2,500 trailing drawdown. Start: balance $50,000, limit $47,500. A trade peaks at $51,000 unrealised and closes at $50,200: the limit is now $48,500, not $47,500. The room for loss has shrunk from $2,500 to $1,700 after a winning trade.
This is why intraday trailing accounts punish letting winners run and then giving back: the peak counts, not the close. Most firms stop trailing once the limit reaches the starting balance (it 'locks' at $50,000 plus a buffer on some accounts). End-of-day and static drawdowns are the two kinder variants.
Size from the drawdown that remains today, not from the account size. The position-size calculator does that for any account of the board.
Questions traders ask
What is Trailing drawdown?
A trailing drawdown is a loss limit that follows the account's highest balance: it rises as the account makes new highs and never comes back down. Intraday trailing means it moves with the unrealised peak of open trades, so a trade that goes +$800 then closes flat has lifted the limit by $800 for good.
Does the trailing drawdown stop moving?
On most futures prop firms it stops once it reaches the initial balance, sometimes plus a small buffer. Until then every new peak, including unrealised peaks on intraday trailing accounts, raises it permanently.