Risk management is the backbone of the Prime Challenge. Two rules define how much you can lose: Daily Drawdown and Max Overall Drawdown.
📉 Daily Drawdown — 4% (Fixed Amount)
How it works: At the start of each day, we look at your balance or equity — whichever is higher.
From that number, you cannot lose more than 4% of the initial account balance in the same day.
Example (100k account):
Initial balance = $100,000 → Daily DD = $4,000 (fixed amount).
Start the day at $105,000 → Max you can lose that day is $4,000, so equity cannot go below $101,000.
Start the day at $98,000 → Max you can lose that day is still $4,000, so equity cannot go below $94,000.
👉 The $ amount (4%) never changes — only the floor shifts each day depending on where you start.
🧱 Max Overall Drawdown — 10% (Static )
This is the hard limit your account can never cross.
It is 10% below your initial balance, and it does not move up when you make profits.
Example (100k account):
Max DD = $90,000.
Even if you grow the account to $110,000, the overall floor stays at $90,000.