Drawdown is the maximum loss your account is allowed to reach. At Moneta Funded, different programs use different drawdown models, so it is important to understand which one applies to your account.
Important Clarification
1-Step Challenge → Static Drawdown
2-Step Challenge → Static Drawdown
Phoenix Challenge → Static Drawdown
Instant Funding → Trailing Drawdown
Instant Funding Pro → Trailing Drawdown
Static Drawdown
(1-Step, 2-Step, and Phoenix Challenges)
What Is Static Drawdown?
Static drawdown is a fixed loss limit calculated from your starting account balance. It does not change, even if your account grows.
Example
Starting Balance: $100,000
Maximum Drawdown: 10% ($10,000)
Lowest Allowed Equity: $90,000
If your account grows to $110,000, your maximum drawdown still remains $90,000.
A violation occurs if your Equity drops below $90,000. This means the drawdown level stays fixed regardless of profit made after the account is opened.
*For the 2-Step Challenge, static drawdown is 10% on the Standard option or 8% on the lower-cost option (4% daily / 8% max). 1-Step and Phoenix use their own program-specific static levels.
Trailing Drawdown
(Instant Funding and Instant Pro)
What Is Trailing Drawdown?
A trailing drawdown is a dynamic loss limit that follows your account’s highest level as you trade. Unlike static drawdown, which stays fixed from the starting balance, trailing drawdown moves upward as your account grows.
The purpose is to protect gains while still enforcing risk limits. The drawdown continues to move up until it reaches the starting balance, after which it no longer trails higher. This behavior is described in Moneta Funded’s separate Instant Funding trailing drawdown article.
Example (Instant Funding)
Before you start trading:
Starting Balance: $100,000
Trailing Drawdown: 5% ($5,000)
Starting Lowest Allowed Equity: $95,000
Once you start trading:
Current Equity: $103,000
Trailing Drawdown: 5% ($5,000)
Lowest Allowed Equity: $98,000
The trailing drawdown continues to move up as your account reaches new highs, until it reaches the starting balance ($100,000), after which it no longer trails higher.
As your account reaches new highs, the trailing drawdown moves upward with it. A violation occurs if your Equity drops below the active trailing drawdown level.
*NOTE: The 5% trailing drawdown applies to Instant Funding accounts purchased on or after 2 July 2026. Accounts purchased before 2 July 2026 use a 6% trailing drawdown.
Instant Funding Pro
Instant Funding Pro accounts also use trailing drawdown, with their own limits:
Maximum loss (trailing): 8% of balance or equity, whichever is higher
Daily loss: 4% of balance or equity, whichever is higher
As with Instant Funding, the trailing drawdown moves up as the account reaches new equity highs, but it never trails above the original starting balance.
Example — $100,000 Instant Funding Pro account (8% trailing):
Account started: maximum loss allowed = $100,000 − $8,000 = $92,000
After a $5,000 profit (balance $105,000): maximum loss allowed = $105,000 − $8,000 = $97,000
After a further $10,000 profit (balance $115,000): calculated $107,000, but the trailing drawdown cannot exceed the original starting balance, so it caps at $100,000
If the account then falls to $100,000, the trailing drawdown has been reached and the account is breached.
Key Reminder
Before trading, make sure you understand which drawdown model applies to your account. Static and trailing drawdowns work differently, and understanding the difference is important for managing your risk correctly.