How is Dynamic Daily Loss Calculated?

The Dynamic Daily Loss limit applies to Soft Daily Loss (SDL) and is recalculated at the end of each trading day based on the total P&L (profit & loss) of the day. The new limit is then applied for the next trading session.

The calculation follows this simple formula:

• New Daily Loss Limit = 25% of Total Profit
• Minimum Daily Loss = Base Daily Loss 

The daily loss will always be at least equal to the initial base value and will never decrease below it, ensuring traders have a minimum safety net even after losses.

Example: 50K Account with Dynamic Daily Loss

• Initial Daily Loss Limit: $1,000
• The trader reaches a total profit level of $5,000 in their account.
• Updated Daily Loss Limit for the Next Day: Since the daily loss limit is dynamically adjusted to 25% of the total P&L, the new limit is calculated as: 
  • $1,000 (initial daily loss limit) → Adjusted to $1,250 (25% of $5,000 profit level)
• Result: The trader's daily loss limit for the next day is now $1,250 instead of the default $1,000, providing more room for risk management.
• If the trader incurs losses: The daily loss limit will adjust accordingly, but it will never drop below the original $1,000 default limit, ensuring a minimum level of protection.