Rules & Limits

This page is a comprehensive reference for every rule type that TestMax enforces during prop firm practice. Understanding these rules deeply is essential — most evaluation failures come from rule violations, not bad trading.

Drawdown rules

The drawdown rule is the single most important rule in any prop firm evaluation. It defines the maximum amount your account can decline from its peak before you fail. TestMax supports four drawdown calculation methods.

Static drawdown

The simplest type. Your maximum loss is a fixed dollar amount below your starting balance, regardless of how much profit you make.

How it works:

• Drawdown floor = Starting balance - Maximum drawdown amount
• The floor never moves — not up, not down
• If your equity touches or drops below the floor, you fail

Example: $50,000 starting balance, $2,000 static drawdown.

Event	Equity	Drawdown floor	Status
Start	$50,000	$48,000	OK
Win $3,000	$53,000	$48,000	OK — floor unchanged
Lose $4,500	$48,500	$48,000	OK — close to floor
Lose $600 more	$47,900	$48,000	FAIL — below floor

Tip

Static drawdown is the most forgiving type once you build a profit cushion. After making $3,000, you effectively have $5,000 of room before hitting the floor. Firms like Bulenox use this type.

Trailing intraday drawdown

The drawdown floor follows your equity high watermark in real time, including unrealized gains. This is the strictest drawdown type.

How it works:

• Drawdown floor = Highest equity ever reached - Maximum drawdown amount
• The floor updates on every tick as your equity changes
• Unrealized P&L counts — if you have an open position in profit, the floor moves up even before you close the trade
• The floor never moves down

Example: $50,000 starting balance, $2,000 trailing intraday drawdown.

Event	Equity	Equity high	Drawdown floor	Status
Start	$50,000	$50,000	$48,000	OK
Open trade, unrealized +$800	$50,800	$50,800	$48,800	Floor moved up
Price pulls back, unrealized +$200	$50,200	$50,800	$48,800	Floor stays
Close trade at +$500	$50,500	$50,800	$48,800	Floor stays at high
Win another $1,500	$52,000	$52,000	$50,000	Floor now at starting balance

Caution

Trailing intraday drawdown is dangerous because unrealized gains ratchet the floor up. If you have a trade that goes $1,000 in your favor and then reverses, you have effectively lost $1,000 of drawdown room even if you exit at breakeven.

Trailing end-of-day (EOD) drawdown

Similar to trailing intraday, but the floor only updates at the end of each trading day based on your closing balance. Intraday equity fluctuations do not affect the floor.

How it works:

• At the end of each trading day, the system checks your closing account balance
• If the closing balance is a new high, the drawdown floor moves up to (new high - maximum drawdown)
• During the trading day, the floor remains at its previous level
• The floor never moves down

Example: $50,000 starting balance, $2,000 trailing EOD drawdown.

Day	Closing balance	Balance high	Drawdown floor	Status
Day 1	$50,800	$50,800	$48,800	Floor trails up at EOD
Day 2	$50,400	$50,800	$48,800	No new high, floor stays
Day 3	$51,500	$51,500	$49,500	New high, floor moves up
Day 4	$49,600	$51,500	$49,500	Close — only $100 of room left

Tip

Trailing EOD is more forgiving than trailing intraday during the session. Your drawdown floor will not move up just because a trade temporarily went in your favor. This gives you more room to manage trades intraday.

Trailing EOD with lock

This is the drawdown type used by TopStep. It works like trailing EOD with one important addition: once the drawdown floor reaches your starting balance, it locks and stops trailing.

How it works:

• Same as trailing EOD — floor updates at end of day based on closing balance highs
• When the floor reaches the starting balance, it locks permanently
• After locking, your drawdown behaves like a static drawdown at the starting balance

Example: $50,000 starting balance, $2,000 trailing EOD with lock.

Day	Closing balance	Balance high	Drawdown floor	Status
Day 1	$50,500	$50,500	$48,500	Trailing
Day 2	$51,200	$51,200	$49,200	Trailing
Day 3	$52,100	$52,100	$50,100	Locked — floor reached $50,000, locks at $50,000
Day 4	$54,000	$54,000	$50,000	Floor stays at $50,000 forever
Day 5	$50,200	$54,000	$50,000	Safe — $200 above locked floor

Note

The lock is a significant advantage. Once you build enough profit to lock the drawdown at your starting balance, you can never fail from the trailing effect. Your only risk is a static drawdown from the starting balance. This is why early risk management is so critical — lock the drawdown as fast as possible.

Drawdown type comparison

Feature	Static	Trailing intraday	Trailing EOD	Trailing EOD with lock
Floor moves up	Never	Every tick	End of day	End of day (until locked)
Unrealized P&L affects floor	No	Yes	No	No
Floor can lock	N/A	No	No	Yes
Difficulty	Easiest	Hardest	Medium	Medium
Used by	Bulenox, FTMO	Some firms	Apex, Earn2Trade	TopStep

Daily loss limit

The daily loss limit caps how much you can lose in a single trading day. This is separate from the trailing drawdown and is reset each day.

How it works:

• At the start of each trading day, the daily P&L counter resets to $0
• Both realized and unrealized P&L count toward the daily limit
• If your daily P&L reaches the negative limit (e.g., -$1,000), you must stop trading for the day
• Violating the daily loss limit may result in evaluation failure depending on the firm’s rules

Example: $1,000 daily loss limit.

Trade	Trade P&L	Daily P&L	Status
Trade 1	-$300	-$300	OK
Trade 2	+$150	-$150	OK
Trade 3	-$500	-$650	OK — still within limit
Trade 4	-$400	-$1,050	VIOLATION — exceeded $1,000 limit

Caution

The daily loss limit includes unrealized P&L. If you have an open trade down $800 and your realized losses for the day are $150, your daily P&L is -$950 — only $50 from the limit. Do not assume you can hold through a drawdown just because you have not closed the trade.

Profit targets

Each evaluation phase has a profit target you must reach to advance.

How it works:

• Your net realized P&L across all trading days in the current phase must reach the target
• Unrealized P&L does not count — you must close the trade to book the profit
• You must also meet the minimum trading days requirement before the phase is considered passed
• There is no time limit in TestMax (though real firms may impose one)

Typical profit targets:

Account size	Phase 1 target	Phase 2 target
$50,000	$3,000	$2,000
$100,000	$6,000	$4,000
$150,000	$9,000	$6,000

Minimum trading days

You must trade on a minimum number of distinct calendar days before a phase can be completed. This prevents traders from passing on a single lucky day.

How it works:

• A “trading day” is counted when you place at least one trade during the session
• You must accumulate the required number of trading days even if you hit the profit target early
• Days where you open the platform but do not trade do not count

For most TopStep configurations, the minimum is 5 trading days per phase.

Consistency rules

Consistency rules prevent you from passing an evaluation based on one or two outsized winning days. They ensure your profit is distributed across multiple sessions.

How it works:

• The rule sets a maximum percentage of total profit that can come from any single trading day
• Common thresholds are 30%-50% of total profit per day
• If any single day’s profit exceeds the threshold, you must continue trading until that day’s share drops below the limit

Example: 40% consistency rule, $3,000 profit target.

Day	Day P&L	Total P&L	Best day %	Status
Day 1	+$500	$500	100%	Not yet at target
Day 2	+$1,800	$2,300	78%	Not yet at target
Day 3	+$800	$3,100	58%	Over target but Day 2 = 58% > 40%
Day 4	+$700	$3,800	47%	Still over 40%
Day 5	+$600	$4,400	41%	Still over 40%
Day 6	+$400	$4,800	38%	PASS — Day 2 now 38% < 40%

Note

Consistency rules are configurable in TestMax and can be disabled if your target firm does not use them. Not all firms enforce consistency — check your specific firm’s rules.

Trading hours restrictions

Many prop firms restrict trading to specific hours, typically aligned with the main US futures session.

How it works:

• You can configure allowed trading hours in your simulation setup
• Orders placed outside allowed hours are rejected
• Open positions must be closed before the session ends (if overnight holding is disabled)
• Common allowed hours: 8:30 AM - 3:15 PM CT for CME futures

Overnight and weekend holding

Some prop firms prohibit holding positions overnight or over weekends.

How it works:

• When enabled, all positions must be closed before the configured session end time
• TestMax will warn you if you have open positions approaching the deadline
• Holding a position past the deadline counts as a rule violation
• This rule is configurable — disable it if your target firm allows overnight holding

Common configurations:

Firm style	Overnight holding	Weekend holding
TopStep (typical)	Not allowed	Not allowed
Apex (typical)	Allowed	Not allowed
Custom	Configurable	Configurable

Rule violation consequences

When a rule is violated in TestMax, the behavior depends on the severity:

Violation	Consequence
Trailing drawdown breached	Evaluation fails — simulation ends
Daily loss limit exceeded	Day ends, may fail evaluation (configurable)
Consistency rule not met	Cannot pass — must trade more days
Trading outside hours	Order rejected, warning displayed
Overnight position held	Warning or violation (configurable)

Next steps

TopStep Simulation How TestMax models TopStep's specific rules

Evaluation Phases How phases work and what changes between them

Tips for Passing Use these rules to your advantage