[Crypto Account] – How does trailing drawdown affect my withdrawal?
When you request a withdrawal, the Max Drawdown locks at your starting balance, regardless of profits made.
This means the buffer created by your profits is reduced by the amount withdrawn.
Withdrawing all available profit would put your account at risk of breaching the drawdown thresholds.
Example 1: No Buffer Left
- Initial balance: $100,000
- Profit: $1,000
- Total balance: $101,000
- Withdrawal request: $1,000 (the entire profit)
Once the payout is processed:
- Your new balance is $100,000
- The Max Drawdown is now locked at $100,000
Because your balance and Max Drawdown are now the same, placing any new trade will cause your equity to drop below the locked drawdown level, resulting in an immediate breach.
Example 2: Leaving a Small Buffer
Let’s say you choose to leave a $200 buffer instead of withdrawing the entire profit.
- Initial balance: $100,000
- Profit before withdrawal: $1,000
- Withdrawal request: $800
- Balance after withdrawal: $100,200
- Max Drawdown (locked): $100,000
Here, your $200 buffer gives you room to keep trading.
As you continue to make profits, your equity grows and so does your effective trading space above the Max Drawdown.
For example, if you grow your account to $102,000, your drawdown limit remains locked at $100,000, giving you $2,000 of buffer space.
Important:
It’s always recommended to leave some profit buffer after a withdrawal to maintain a safe distance from your Max Drawdown.
The amount of buffer you leave is entirely your choice but the larger your remaining balance above the locked drawdown, the more flexibility and safety you’ll have when continuing to trade.
