What does it mean when the drawdown locks?

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What does it mean when the drawdown locks?

On a trailing drawdown, the line that closes your account follows your balance up. “Locking” means it stops following. After that, every dollar you make adds to your room instead of moving the line.

Before the lock: the line follows you

Example: a $50,000 account with a $2,000 trailing drawdown. The line starts at $48,000. Each time your highest balance goes up, the line goes up by the same amount. So before the lock, your room never gets bigger than $2,000, however well you do.

highest balance line room $50,000 $48,000 $2,000 $51,000 $49,000 $2,000 $52,000 $50,000 $2,000

At $52,000 the line has reached your starting balance.

At the lock: the line stops

Many firms stop the line once it reaches your starting balance (some a little above it, such as $100 over). In the example that happens when your highest balance reaches $52,000. From then on the line stays at $50,000.

After the lock: profit becomes room

balance line room $52,000 $50,000 $2,000 $53,000 $50,000 $3,000 $54,500 $50,000 $4,500

This is the point where the account gets easier to hold. Before it, one bad day always has the same $2,000 to eat into. After it, the room grows with you.

What to check in your firm’s wording

  • Does it lock at all, and where? At the starting balance, a little above it, or never.
  • What moves the line before the lock? Open profit (intraday trailing) or closing balance (end-of-day). The intraday vs end-of-day article works one trade through each.
  • What happens when you withdraw? At many firms the locked line stays put, so a payout comes straight out of your room. Take $1,000 from a $53,000 balance and your room drops from $3,000 to $2,000.

Why it changes how you trade

Before the lock, the job is to get there without giving back open profit. Targets you actually take matter more than winners you let run. After the lock, the job is to keep enough room above the line, especially after each payout. The rule decoder shows where your line sits today, locked or not.

Prop firm rule decoderWhere the line that closes your account actually sits, and what open profit costs you. Drawdown runway calculatorHow many maximum-loss days your account can survive. Payout-day checkRoom after a payout, plus qualifying days, consistency and limits.

See where your line sits

Your drawdown type, your balance, your highest point. Locked or still trailing.

Open the rule decoder

Track it as you go

The Rules Desk Journal & Workbook is a 500-row trade log that works out your win-rate range, break-even, average result per trade and what rule breaks cost you. $39, instant download.

See what's in it

Educational material only. Not investment advice. Trading futures involves substantial risk of loss and most people who try it lose money. Check your account rules with your firm; they change.