Trading mechanics
Stop-out
The automatic closing of positions when equity falls below the level needed to maintain them. On a prop account the phrase is also used loosely for hitting the maximum drawdown floor.
GFN’s figure
On GFN accounts the drawdown floor is the level that matters: $92,000 on a $100,000 2 Step account, fixed, and $95,000 on Instant before it trails upward.
In detail
Stop-out,explained
The two meanings are worth separating. A platform stop-out is a margin mechanism; a drawdown stop-out is a rule breach, and only the second one ends the account.
Trading against either as though it were a stop loss is the same mistake in two forms: both are the system's last resort, not a risk plan.
Related
Terms thatcome with it
Most rules only make sense next to the ones they interact with. These are the entries this one depends on.
Margin call
A warning issued when equity falls to a set percentage of the margin required for open positions. It signals that the account is close to being unable to support the trades it holds.
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.
Margin
The portion of account equity set aside to hold an open position. It is a deposit against the position rather than a cost, and it is returned to free margin when the position closes.
Hard breach
A violation serious enough to fail or terminate the account immediately. Exceeding the daily loss limit or the maximum drawdown is the usual cause, and a later recovery in the market does not reverse it.
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.
Ready when you are
Your capital stays yours.The risk is ours.
One evaluation fee, no time limits and up to 90% of simulated profits. Pick an account size and your credentials arrive by email within minutes.
No subscriptions or hidden fees
Payouts every 14 days
$400,000 max total allocation