Drawdown and loss limits · Pro
Drawdown buffer
Also searched as: loss allowance, remaining drawdown
What does Drawdown buffer mean?
A drawdown buffer is the distance between the account’s current monitored value and the applicable loss floor. It describes remaining room, not the headline account size.
Example
Equity of $51,200 above a $49,000 floor leaves a $2,200 buffer.
Illustrative example; not a provider’s quoted offer.Why it matters for prop traders
Recalculate after profits, payouts and threshold adjustments; several limits may apply simultaneously.
Sources and further reading
The following primary sources support the terminology. Provider rules describe their own products and may change.