Fewpips Trailing Drawdown: How the Maximum Loss Floor Works

Short answer: The Fewpips maximum loss limit is a trailing floor. It trails up with your profit and never moves down, and it is not capped at your starting balance. The more your equity grows, the higher the floor rises, so your buffer widens as you profit.

The trailing floor is the drawdown question traders find most confusing, especially the behaviour after a payout. The good news is that the Fewpips model works in your favour as the account grows. Here is exactly how it moves.

The Floor Trails Up, Never Down

Your maximum loss limit sets a floor that trails your highest equity - your peak account value, including open profit. As your equity rises to a new high, that floor trails up with it. When your equity falls, the floor stays where it is. It only ever moves in one direction: up. Because it tracks equity and not just closed balance, floating profit on an open trade lifts the floor too: if a winning position pushes your equity to a new peak and then price retraces, the floor stays locked at that higher level. Critically, it is not capped at your starting balance. It keeps climbing as your account grows.

Worked Example

$50,000 account, 10% maximum drawdown:
The floor starts at $5,000 below your equity, so at $50,000 the floor sits at $45,000.
Grow the account to $70,000. The maximum drawdown is still 10%, which is now $7,000, so the floor rises to $63,000.

Your buffer grew from $5,000 to $7,000 simply because your equity grew. The floor locked in at $63,000 and will not drop back down.

Why This Matters After a Payout

Because the floor never retreats, banking profit and taking a payout does not reset your protection back to the starting balance. The gains you have locked in continue to lift the floor. This is what makes the trailing model trader-friendly: the further you get, the more room you have earned.

How It Fits the Rest of Your Risk

The trailing floor is your account-level backstop. Day to day you are also bound by the 2% per-trade cap and any daily loss limit. If the floor is breached, the account is closed and is not recoverable except for a proven technical glitch, so treat the floor as the line you never test.

Frequently Asked Questions

Is the Fewpips trailing floor capped at my starting balance?

No. The maximum loss limit is not capped at your starting balance. It trails up as your equity climbs to new highs and never moves down, so your buffer widens as you profit.

Does the drawdown floor reset after I take a payout?

No. The floor never retreats. Taking a payout does not reset your protection to the starting balance; the gains you locked in continue to hold the floor higher.

What happens if I hit the maximum loss floor?

The account is breached and closed. A breached account is not recoverable, except in the case of a genuine major technical glitch proven with evidence from your side.

How the Trailing Maximum Loss Floor Works