Prop Firm Rules Explained

The performance target is the required virtual account gain for a challenge stage. Traders should avoid high leverage or oversized positions to reach the target quickly.

The daily loss limit is the maximum loss allowed in a single trading day. Traders should stop before reaching the limit because fast price movement can cause a breach.

If a rule table shows a 5% daily loss limit on a 100,000 account, the daily loss boundary is 5,000. Traders should use the live dashboard and applicable plan rule table because the exact calculation method and account state matter.

Maximum drawdown is the total loss limit for the account. It may be calculated by balance, equity, starting balance, highest equity, or another method depending on platform rules.

If a rule table shows a 10% overall drawdown limit on a 100,000 account, the boundary is 10,000. This example explains the percentage only; traders must follow the active challenge rules and dashboard values.

Some challenges require a minimum number of trading days to encourage consistent evaluation rather than one lucky trade.

Some prop firms use consistency rules to check whether profit comes from controlled trading or one oversized trade.

Restrictions may include position size limits, instrument restrictions, holding period rules, or news-event rules.

Even after becoming profitable in the simulation, rewards may require rule compliance, KYC, review, and verification. Where approved, eligible performance rewards may be shared 80/20: 80% to the trader and 20% to TradeIQ Capital.

Before starting, write down your maximum loss per trade, daily stop limit, maximum open risk, allowed instruments, performance target, reward eligibility date if applicable, and account failure conditions.