---
title: "High-water mark - Meaning & GFN's Figure - Get Funded Now"
description: "The highest level an account has ever reached. On a trailing drawdown it is the reference point the floor is measured down from, so every new high…"
url: "https://getfundednow.com/glossary/high-water-mark"
language: "en"
last_modified: "2026-09-22"
publisher: "Get Funded Now (getfundednow.com)"
translations:
  es: "https://getfundednow.com/es/glossary/high-water-mark"
  pt-BR: "https://getfundednow.com/pt-br/glossary/high-water-mark"
  fr: "https://getfundednow.com/fr/glossary/high-water-mark"
  it: "https://getfundednow.com/it/glossary/high-water-mark"
  de: "https://getfundednow.com/de/glossary/high-water-mark"
disclosure: "All trading at Get Funded Now is simulated. 'Funded' means a simulated or virtual account; GFN is not a broker and does not hold client funds."
---

Drawdown and risk limits

# High-water mark

The highest level an account has ever reached. On a trailing drawdown it is the reference point the floor is measured down from, so every new high permanently moves the breach level upward.

Also called: Equity high · Peak balance

GFN’s figure

GFN's Instant drawdown trails the high-water mark by 5%. The 1 Step drawdown trails during the evaluation until the floor reaches your starting balance, where it locks. The 2 Step ignores the high-water mark entirely.

- **Instant Trails the high**: Yes, by 5%
- **1 Step Trails the high**: Until the floor reaches the starting balance, then locks
- **2 Step Trails the high**: No

In detail

## High-water mark, explained

The high-water mark only ever ratchets up. Making a new high tightens a trailing account rather than loosening it, which is the part traders find counter-intuitive: the better the week, the less room below.

The same term is used in fund management for the level a manager must exceed before performance fees are charged again. In prop trading it is almost always the drawdown reference instead.

Worked example

A $100,000 Instant account that peaks at $108,000 carries a floor of $103,000 from that point on, even if equity falls back to $102,000.

[The rule in full →](https://getfundednow.com/rules/trailing-drawdown) · [Rules handbook](https://getfundednow.com/rules) · [More drawdown and risk limits](https://getfundednow.com/glossary/category/drawdown)

Related

## Terms that come with it

Most rules only make sense next to the ones they interact with. These are the entries this one depends on.

- [Trailing drawdown](https://getfundednow.com/glossary/trailing-drawdown) - A maximum drawdown whose floor follows the account upward as it makes new highs. The distance between your peak and the breach level stays constant, so every new high moves the stop-out level with it.
- [Drawdown floor](https://getfundednow.com/glossary/drawdown-floor) - The account level at which a maximum drawdown breach is recorded. It is the starting balance minus the drawdown allowance, expressed as a dollar figure rather than a percentage, and it is the single number to trade against.
- [Equity curve](https://getfundednow.com/glossary/equity-curve) - A chart of account equity over time. Its slope shows the rate of return, its smoothness shows consistency, and its deepest dip is the peak-to-trough drawdown a risk limit would have had to absorb.
- [Peak-to-trough](https://getfundednow.com/glossary/peak-to-trough) - The decline from an equity curve's highest point to its lowest subsequent point before a new high is made. It is the standard way of stating how deep a strategy's worst historical losing run was.
- [Maximum drawdown](https://getfundednow.com/glossary/maximum-drawdown) - The total loss an account may take before it is failed. Expressed as a percentage of the starting balance, it sets a floor: touch it and the account breaches, whatever the account has made up to that point.

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Source: https://getfundednow.com/glossary/high-water-mark
Facts about Get Funded Now in one file: https://getfundednow.com/llms.txt