Concepts · The path 03
EOD trailing, explained simply
Most people don't fail evals on a bad trade. They fail on a rule they never fully understood — the end-of-day trailing drawdown.
What "trailing drawdown" means
Every funded evaluation gives you a maximum loss limit — a floor your account balance can't drop below. A trailing drawdown is one where that floor moves up as your account grows. Make money, and the floor follows you higher. The catch is what happens on the way down.
Why "end of day" changes everything
There are two common versions of the trailing rule, and the difference decides how you trade:
- Intraday trailing follows your account's highest point during the session, tick by tick. Your unrealised profit counts against the floor the moment it appears.
- End-of-day (EOD) trailing only locks the floor higher based on your closing balance each day. Intraday spikes don't move it.
EOD sounds gentler, and in one way it is — but it hides a trap. Because the floor jumps at the close, a green day permanently raises the bar you have to clear tomorrow.
The mistake almost everyone makes
You're up a good amount mid-session. The intraday high feels like money in the bank. On an EOD account it isn't — if you give it all back before the close, the floor never moved, and you've burned a day of risk for nothing.
The trailing floor isn't measuring how much you made. It's measuring how much you kept when the bell rang.
How I trade around it
Three habits keep the rule from ending my evals:
- Bank green days by closing flat-to-up, not by chasing the intraday high.
- Size so a single full-stop loss never drops me near the floor.
- Know the exact dollar distance to my floor before the session, not during it.
Next step on the path: pick a firm — and check which trailing model each one uses before you buy.