The short answer
A static maximum drawdown is a fixed floor that never moves, however much profit you make. A trailing maximum drawdown starts as a floor below your balance and follows your equity higher as you profit, locking in your gains as it rises. At UZO, Two Step uses an 8% static maximum drawdown, whilst One Step and the Instant family use trailing. Whichever product you trade, your live floor is always shown on your dashboard, so you never have to work it out by hand.
Maximum drawdown is the lowest your account is ever allowed to fall before the breach line is reached. The only difference between static and trailing is whether that line stays put or moves with your performance. Both are measured on your equity, which includes the open and floating profit or loss of any position you are currently holding, and both are updated in real time. Because the measure is your equity rather than your closed balance, the floor follows an open trade to a new high and back with it.
Static: a fixed floor
A static maximum drawdown is set once, from your starting balance, and does not change for the life of the account. Profit does not raise it, and a drawdown does not lower it. It is a single number you can work out on day one and rely on thereafter.
UZO's Two Step uses an 8% static maximum drawdown. On a $10,000 account the floor sits at $9,200 and stays there. Whether your equity is $10,000, $12,000 or $20,000, the breach line is the same $9,200. The advantage is complete predictability: you always know your absolute worst case, and a strong run never tightens your leash.
Static in one line
Set from your starting balance and fixed for the life of the account. Profit does not move it. Two Step uses 8% static.
Trailing: a moving floor
A trailing maximum drawdown begins as a percentage below your starting balance, then trails your equity higher as you reach new peaks. When you profit and your equity sets a new high, the floor rises with it by the same distance. Should you later give some profit back, the floor does not fall again, so the gains it has already captured stay protected.
UZO's One Step uses a 6% trailing maximum drawdown, Instant uses 5% and Instant Pro uses 6%. Instant 24h uses a 3% trailing maximum drawdown. Because the floor follows you up, the amount it protects grows automatically as you trade well, and your exact current floor is always shown live on your dashboard rather than something you have to recompute.
A worked example on One Step, with its 6% trailing floor on a $10,000 account. Your floor starts $600 below your balance, at $9,400. As your equity climbs, the floor trails $600 beneath your highest equity point in real time. Once your equity reaches $10,600, a 6% gain, the floor has trailed all the way up to $10,000, your starting balance.
Trailing in one line
Starts below your balance and rises with new equity highs, never falling back. On One Step, Instant and Instant Pro it locks at your starting balance; on Instant 24h it never locks and keeps trailing. One Step 6%, Instant 5%, Instant Pro 6%, Instant 24h 3%.
Where the trailing floor stops rising
A trailing floor does not chase you upward forever. On One Step, Instant and Instant Pro the floor trails your equity higher as you profit, and once it has risen all the way up to your starting balance it locks there. From that point it stops moving with new highs, so a later losing run cannot take you below the capital you began with.
Instant 24h works differently: its 3% trailing floor never locks. It keeps trailing your equity for the life of the account and does not settle at your starting balance. On a $10,000 Instant 24h account the floor sits $300 below your highest equity point at every moment, wherever that high has reached.
In plain terms: early on, the trailing floor protects your gains by rising. On One Step, Instant and Instant Pro, once the floor reaches your starting balance it becomes a fixed safety line at your starting capital, giving you room to keep trading without it tightening any further. On Instant 24h the floor never locks and continues to trail behind your equity. Your dashboard shows exactly where the floor sits at every moment.
Maximum drawdown and daily drawdown are two separate limits
The maximum drawdown on this page is the floor under your whole account over its lifetime, static or trailing. It is not the same as the daily drawdown, which is a separate limit that measures only the current trading day and resets at 00:00 UTC. Both limits are always active and both are measured on your equity. Whichever one you reach first is the one that ends the account, so it is worth watching both on your dashboard. The daily drawdown is covered in its own article.
Which product uses which
Product | Max drawdown type | Value |
One Step | Trailing, locks at starting balance | 6% |
Two Step | Static | 8% |
Instant | Trailing, locks at starting balance | 5% |
Instant Pro | Trailing, locks at starting balance | 6% |
Instant 24h | Trailing, never locks | 3% |
Whichever product you trade, the live floor is always displayed on your dashboard, so you never have to guess how close you are to the line.
Related
Maximum drawdown explained
The trailing drawdown
Daily drawdown explained
