A static drawdown never moves: on a $50,000 account with $2,000 of drawdown the floor is $48,000 forever. A trailing drawdown follows your high-water mark.
End-of-day trailing, step by step
$50,000 account, $2,000 trailing end-of-day drawdown that stops trailing at the starting balance:
| End-of-day balance | High-water mark | Floor | Cushion | |
|---|---|---|---|---|
| Day 1 | $50,800 | $50,800 | $48,800 | $2,000 |
| Day 2 | $51,500 | $51,500 | $49,500 | $2,000 |
| Day 3 | $51,100 | $51,500 | $49,500 | $1,600 |
| Day 4 | $52,400 | $52,400 | $50,000 | $2,400 |
Once the floor reaches $50,000 it stays there, so every dollar above it is cushion you keep. Intraday trailing follows the highest unrealised balance instead, which can tighten the floor on a trade you closed lower. Check which type your firm uses.
The Prop Firm Drawdown & Payout Tracker does this daily for static, end-of-day and intraday trailing rules. Related: prop-firm challenge FAQ.
Free download: the Pre-Trade Checklist + Daily Risk Card (printable PDF). Want every tool at once? The Prop Firm Trader Bundle has all four spreadsheets for $29.99. Or try the free position size calculator.
For education and record-keeping only. Not financial advice. Trading involves substantial risk of loss. Prop firms set and change their own rules; check your firm's current rules.