The Challenge
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      1. OANDA Prop Trader FAQ
      2. The Challenge

      Understanding the Rules

      Understanding the rules can sometimes be tricky. Here are a few examples to help clarify things for you.

      Prop Trader A 

      • Challenge Plan: Gold 
      • Virtual Capital: $100,000
      • Max daily loss limit amount: $5,000 (5% of the previous day's EOD balance)
      • Daily loss limit trigger level (static for the day): $95,000 (95% of the previous day's EOD balance)
      • Max Drawdown limit (trailing): $90,000 (10% of the initial balance)

       

      Scenario 1: Prop trader breaches challenge when unrealised P&L exceeds daily loss limit trigger level of $95,000

      Day 1

      • Unrealized profit/loss (P&L): -$3,000
      • Equity: $97,000 ($100,000 - $3,000)

      Day 2 - BREACH

      • Equity Start of day balance: $97,000
      • Day 2 Unrealized P&L: -$4,000
      • Total unrealized profit/loss (P&L): $3,000+ $4,000 = $7,000
      • Equity: $93,000 ($100,000 - $7,000)
      • Limit is breached when equity falls below the Daily Loss Limit Trigger level of $95,000


      Scenario 2: Prop trader's unrealized P&L goes down but did not breach the challenge

      Day 1

      • Realized profit/loss (P&L): -$3,000
      • Balance: $97,000

      Day 2 - NOT BREACHED

      • Unrealized profit/loss (P&L): - $4,000 
      • Daily loss limit calculated amount: $4,850 (5% x $97,000 of  previous day balance) 
      • Daily Loss Limit trigger level: $92,150 ($97,000 - $4,850)
      • Equity: $93,000 ($97,000 - $4,000) 
      • Equity does NOT fall below Daily Loss Limit Trigger 

       

      Scenario 3: Prop Trader realized profits and subsequently accumulated unrealised loss. Does not breach challenge. 

      Day 1

      • Realized P&L: $20,000
      • Account Balance: $120,000
      • Daily loss: $6,000 (5% of $120,000)
      • Daily loss limit trigger level: $114,000 
      • Max Drawdown Limit trigger level: $100,000 (10% from Initial Balance trailed up to the maximum of the initial balance)

      Day 2 - NOT BREACHED

      • Realized P&L: -$5,000
      • Equity: $115,000 (Above daily loss limit trigger of $114,000)


      Scenario 4:  Prop Trader with unrealized profits and subsequently accumulated unrealized loss. Did not breach the challenge. 

      Day x

      • Unrealized P&L: $20,000
      • Equity: $120,000
      • Daily loss: $5,000 (5% of $100,000)
      • Daily loss limit trigger level: $95,000 

      Day x+1 - NOT BREACHED

      • Unrealized P&L: - $10,000
      • Equity: $110,000 (Above daily loss limit trigger level of $95k)

       

      Scenario 5: Prop trader realized profits and accumulated unrealized losses - Breach challenge.

      Day 1

      • Realized profit/loss (P&L): $5,000
      • Balance: $105,000
      • Daily loss calculated amount: $5,250 (5% of previous balance) 
      • Daily loss limit trigger level: $99,750 ($105,000 - $5,250)
      • Drawdown Limit: $94,500 (Trails up)

      Day x 

      • Realized profit/loss (P&L): $3,000 
      • Balance: $108,000
      • Daily loss calculated amount: $5,400 (5% of previous balance) 
      • Daily loss limit trigger level: $102,600 ($108,000 - $5,400)
      • Drawdown Limit: $97,200  (Trails up)

      Day xx - no breach 

      • Unrealized profit/loss (P&L): -$5,000 
      • Balance: $108,000
      • Equity: $103,000
      • Daily loss calculated amount: $5,400 (5% of previous balance) 
      • Daily loss limit trigger level: $102,600
      • Drawdown Limit: $97,200 

      Day xx+1 - BREACH

        • Unrealized profit/loss (P&L): -$600 
        • Balance: $108,000
        • Start of Day Equity: $103,000
        • Equity including daily P&L: $102,400
        • Daily loss calculated amount: $5,400 (5% of previous balance) 
        • Daily loss limit trigger level: $102,600 ($108,000 - $5,400)
        • Drawdown Limit: $97,200
      • Equity is below the Daily Loss Limit

       

      Prop Trader B

      • Challenge Plan: Platinum
      • Virtual Capital: $250,000
      • Daily loss: $12,500 (5% of the previous day's balance)
      • Daily loss limit trigger level (static for the day): $237,500 (95% of the previous day's balance)
      • Drawdown limit (trailing): $225,000 (10% of the initial balance)

       

      Scenario 7:   Prop trader initiates a payout but does not breach the challenge

      Day 1

      • Previous day’s balance: $250,000
      • Unrealized P&L: $10,000
      • Equity: $260,000
      • Daily loss: $12,500 (5% of $250,000)
      • Daily loss limit trigger level: $237,500 
      • Drawdown limit: $225,000 (has not yet trailed up)

      Day 2 - NOT BREACHED

      • Payout: $10,000
      • Equity: $250,000
      • Daily loss: $12,500 (5% of $250,000)
      • Daily loss limit trigger level: $237,500 
      • Drawdown limit: $225,000 (Trails down) 

       

      Scenario 8:   Prop trader initiates a payout but subsequently breaches the challenge when unrealized P&L exceed the max draw down

      Day x 

      • Realized P&L:  $30,000
      • Balance: $280,000 
      • Daily loss: $14,000 
      • Daily loss limit trigger level: $266,000 
      • Drawdown limit: $250,000 (Max drawdown trailing will stop when this has reach the initial balance of the account which is $250,000 in this case) 

      Day xx 

      • Payout - $25,000
      • Balance: $255,000 
      • Daily loss calculated amount: $12,750
      • Daily loss limit trigger level: $242,250 (95% from the equity balance $250,000)
      • Drawdown limit: $250,000 (Max drawdown trailing will not trail down as the balance still exceeds the initial account balance which is $250,000 in this case) 

      Day xx -  BREACH

      • Unrealized P&L:  $6,000
      • Equity: $249,000 
      • Max Draw Down trigger level: $250,000