What Is a Daily Loss Limit?
Last updated: October 2026
A daily loss limit is the maximum amount you can lose in a single trading session before your account is paused or terminated for the day.
How It Works
The daily loss limit is separate from your overall drawdown. It prevents catastrophic single-day losses. For example, a firm might set a $1,000 daily loss limit on a 50K account — if your losses reach $1,000 in one session, trading is halted for the day. Some firms terminate your evaluation on a daily limit breach; others just pause trading until the next session.
Example
How it differs from drawdown: drawdown is your total allowed loss from your peak equity. Daily loss limit is your max loss in one session. You can have $2,500 drawdown remaining but still breach a $1,000 daily limit. Some firms have NO daily loss limit — only overall drawdown matters. Check each firm's rules carefully.
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