What is Trailing Drawdown?
A drawdown limit that follows your account's highest equity point upward but never moves down — making your floor progressively tighter as profits grow.
Trailing drawdown is the most punishing type of drawdown rule because the limit follows your profits upward but never retreats. As you make money, your drawdown floor rises — locking in a tighter band around your current equity.
How it works:
Start: $100,000 account, 10% trailing drawdown. Floor starts at $90,000.
| Account High | Trailing Floor (10% below high) |
|---|---|
| $100,000 (start) | $90,000 |
| $105,000 | $94,500 |
| $110,000 | $99,000 |
| $115,000 | $103,500 |
If you reach $115,000 and then lose back to $103,500 — you breach the trailing drawdown and fail, even though you're still at a profit from your starting balance.
Trailing vs. static drawdown:
| Type | Floor Movement | Risk Profile |
|---|---|---|
| Trailing | Rises with highs, never falls | Tighter over time as profits grow |
| Static | Fixed from starting balance | Fixed floor regardless of profits |
Who uses trailing drawdown:
Topstep uses trailing drawdown for its Trading Combine. Many traders find it the most challenging type because a profitable run can actually make the challenge harder — your floor rises into dangerous territory if you overshoot.
Strategy for trailing drawdown challenges:
Take profits consistently rather than letting winners run too far. Large unrealised gains that then partially reverse can lock in a very high trailing floor. Book profits regularly to control the floor.
Related Calculators
Topstep Calculator
Track your Topstep daily drawdown limit. Pre-configured for Topstep's trailing drawdown structure used in the Trading Combine.
Daily Drawdown
Track your prop firm daily drawdown limit in real time. Avoid breaching account rules with this FTMO, MyFundedFX, and Topstep-compatible calculator.