The 5 Prop Firm Drawdown Classifications

How it works: The mechanic changes by plan, option, or account stage. Check the exact evaluation, sim-funded, Master, Funded, and Live rules instead of applying one label firm-wide.

Best for: traders who compare plan-level rules before checkout and re-check the mechanic when moving to another option or stage.

How it works: MLL trails up at end-of-day close, then locks at starting balance permanently. Intraday equity drops don't reset it.

Best for: traders who want their starting capital protected after the lock event. The most forgiving mechanic, preferred by Paul.

How it works: MLL moves UP at end-of-day close, never locks. Keeps following equity-high forever. Intraday drops do not matter; only close matters.

Best for: traders who want maximum profit retention without locking. Strong for systematic strategies that close positions cleanly each day.

How it works: MLL follows the highest intraday equity tick by tick. Even a short equity spike can move the MLL up immediately. No other category reacts as directly to brief intraday highs.

Best for: high-conviction traders who size carefully. Most stressful mechanic; requires real-time risk management.

How it works: MLL is a fixed dollar amount below starting balance. Never moves. Simplest mechanic to track.

Best for: beginners or traders who prefer clarity over flexibility. The cleanest math.