V E R T E X | F U N D I N G
Frequently asked questions
• Soft breach means that we will close all trades that have violated the rule. However, you can continue trading in your Instant Funded Account. This links to the inactivity rule.
• Hard breach means that you violated the Daily Loss Limit or Max Drawdown rule, or Inactivity rule. These rules constitute a hard breach. In the event you have a hard breach, you will have your Funded Account taken away.
The Maximum Drawdown is initially set at 8% and trails (using CLOSED BALANCE - NOT equity) your account until you have achieved a 8% return in your account. Once you have achieved the 8% return, the Maximum Trailing Drawdown no longer trails and is permanently locked in at your starting balance.
Example: If your starting balance is $100,000, you can drawdown to $92,000 before you would violate the Maximum Trailing Drawdown rule. Then for example let's say you take your account to $102,000 in CLOSED BALANCE. This is your new high-water mark, which would mean your new Maximum Trailing Drawdown would be $94,000. Next, let's say you take your account to $108,000 in CLOSED BALANCE, which would be your new high-water mark. At this point your Maximum Trailing Drawdown would be locked in at your starting balance of $100,000. So, regardless of how high your account goes, you would only breach this rule if your account drew back down to $100,000 (note, you can still violate the daily drawdown). For example, if you take your account to $170,000, as long as you do not drawdown more than 5% in any given day, you would only breach if your account equity reaches $100,000.
The Daily Loss Limit is the maximum amount your account can lose on any given day. The Daily Loss Limit is calculated using 5% of the previous day's balance which resets at 5 PM EST. The Daily Loss Limit compounds with the increase in your account. Example: if your prior day's end of day balance (5pm EST) was $100,000, your account would violate the daily stop loss limit if your equity reached $95,000 during the day. If your floating equity is +$5,000 on a $100,000 account, your new- day (5pm EST) max loss is based on your balance from the previous day ($100,000). Not the floating equity. So, your daily loss limit would still be $95,000. This is referred to as balance based drawdown, not equity based.
As Standard* we require all trades to be closed by 3:45 PM EST on the last trading day of the week, typically Friday. However, in cases where markets close early or are not open on a Friday, it is the trader’s responsibility to ensure all trades are closed before the weekend based on the adjusted market schedule. Any trades left open after this time will be automatically closed. Note, this is considered a soft breach, and you will be able to continue trading once the markets reopen.
* Weekend holding is available at checkout as an optional upgrade.