What is Equity-Based Drawdown?

FundedCobra's Daily Loss Limit and Maximum Drawdown (overall loss limit) both use equity.

What equity-based means

Equity is your balance plus the profit or loss on your open trades. Because open trades count, your account can end (a breach) while a losing trade is still open. You don't have to close the loss first.

Static does not mean balance-only

• The Daily Loss Limit uses your equity at the daily reset. The lowest level allowed, your floor, stays the same for that trading day. It does not move up when you make profit during the day. Venom 2.0 is different: its floor moves up as your equity grows (this is called trailing). See Venom 2.0.
• The Maximum Drawdown uses your original starting balance. Its floor stays the same for as long as you have the account.

Example: King Cobra daily limit

Your equity at the daily reset is $10,000 and the Daily Loss Limit is 4%. You can lose $400, so your floor for that day is $9,600.

If your equity falls below $9,600, your account ends, even if part of the loss is on a trade that is still open.