Rule #08

Risk and Account Management

In any account size, you must not have a drawdown of 5% or higher in a trading day (floating drawdown – calculated with equity, or balance, at any given time). This will be monitored closely and if violated will result in account suspension.

Drawdown % = [1 – (lowest equity or balance for the day) / (starting equity or balance for the day) ] X 100

Furthermore, you must not have a drawdown of 12% or higher overall throughout your pay period.

These two rules (5% and 12% drawdown), along with consistency (Rule #2) will be monitored closely and if violated will result in account suspension. Account suspensions can be reset by paying account sign up cost minus 20% (i.e. for 10K account – account sign up fee is $99. Reset fee will be $95).