PropFirm Account Rules

PropFirm Account Rules let a firm enforce proprietary-trading (“prop firm”) risk rules on individual accounts, evaluated continuously by the T4 Account Handler. The first available rule is the Trailing Drawdown: the account tracks a high-water mark (HWM), and if the account's net liquidation value falls to the trailing floor, T4 liquidates all positions, cancels all working orders, and disables the account.

The rule formula:

Breach when:  NLV <= Min( HWM - Drawdown, Starting Balance )

• The HWM only ever moves up. It is reset only by an epoch bump.
• The floor trails the HWM but is capped at the Starting Balance — once a trader is up by more than the drawdown amount, the account can never lose more than back to its starting balance.
• Costs charged by auto-liquidation fills are excluded from the rule's NLV, so a liquidation's own fees can never cause or worsen a breach (see cost exclusion).

Two fields on the account (set via the Admin API account endpoints, or the Admin Portal where available):

The rules document:

{
  "SchemaVersion": 1,
  "Epoch": 1,
  "Rules": [
    {
      "Type": "TrailingDrawdown",
      "RuleIndex": 0,
      "Enabled": true,
      "Params": {
        "DrawdownAmount": 2000,
        "Variant": "EndOfDay"
      }
    }
  ]
}

• Intraday — the HWM ratchets on live NLV (balance plus open-position profit) on every evaluation. An unrealized peak counts even if the trader gives the profit back.
• EndOfDay — the HWM commits only when the trade date rolls, on the realized balance. Intraday peaks do not count.

The breach check runs continuously in both variants. The variants differ only in when the floor tightens, never in when a breach is detected — an EndOfDay account that hits its floor mid-session is liquidated mid-session.

On first activation (and after every epoch bump) the HWM seeds at Max(Starting Balance, current NLV).

$50,000 plan, DrawdownAmount 2000, Variant Intraday. HWM seeds at 50,000; the floor starts at 48,000.

• Day 1: the unrealized peak of 51,250 ratchets the HWM, even though only $800 was kept. This is the defining property of the Intraday variant.
• Day 2: the floor reaches the Starting Balance cap — from now on it stays at 50,000 no matter how high the HWM climbs.
• Day 3: when NLV touches 50,000 the rule breaches: positions liquidated, orders cancelled, account disabled. The audit shows the formula values, e.g. 49998.50 ⇐ Min(52400.00 - 2000.00, 50000.00) = 50000.00.

$50,000 plan, DrawdownPercent 4 (4% of 50,000 = $2,000), Variant EndOfDay. HWM seeds at 50,000; the floor starts at 48,000.

• Day 1: unlike the Intraday variant, the 51,900 peak is ignored — only the realized 51,200 commits, and only at the day roll.
• Day 2: the HWM never moves down; the floor holds at 49,200.
• Day 3: the moment live NLV touches 49,200 — even mid-session — the account breaches and is liquidated. EndOfDay controls the ratchet, not the enforcement.

On breach, T4 immediately:

1. Liquidates all open positions (market-order auto-liquidation),
2. Cancels all working orders,
3. Disables the account,
4. Sends the standard auto-liquidation notifications with trigger type TrailingDrawdown.

The breach then latches: re-enabling the account without resetting the rule causes the engine to disable it again. The only way to re-arm a breached account is an epoch bump.

After a payout, a plan reset, or a breach review, increment the Epoch in the rules document (the Admin API provides a one-call endpoint for this). The engine then:

• Re-seeds the HWM at Max(Starting Balance, current NLV),
• Clears the breach latch,
• Clears the accumulated auto-liquidation cost exclusions.

Note: an epoch bump does not change the account balance. Adjust the balance first (e.g. after a payout), then bump the epoch so the HWM re-seeds from the adjusted value.

Fees charged by auto-liquidation fills are added back to the rule's NLV forever, so a liquidation can never push an account (further) through its floor. The firm-level setting CommissionExclusionScope controls the scope:

Rule state fields returned by the state endpoint: