Most FTMO accounts are not lost at the profit target but at a limit. And the limit that surprises traders most often is the Maximum Daily Loss. It sounds simple – "5% per day" – but it is calculated differently from what many people assume.
The rule in one sentence
Your equity must never fall below the balance at midnight minus 5% of the initial capital on any given day (2-Step). In the 1-Step Challenge it is 3%. Midnight refers to the CE(S)T time zone (Central European Time).
| Program | Daily limit | Reference point |
|---|---|---|
| FTMO Challenge 2-Step | 5% of initial capital | Balance at 00:00 CE(S)T |
| FTMO Challenge 1-Step | 3% of initial capital | Balance at 00:00 CE(S)T |
On the first day, the initial capital is used instead of the midnight balance.
Three things many traders miss
1. Equity counts, not balance. Equity means balance plus open profits and losses, plus or minus swaps, minus commissions. An open position that dips deep into the red for a moment can breach the limit – even if it later turns positive and you never closed a losing trade.
2. The 5% refers to the initial capital, not your current balance. On a 100,000 account it is always USD 5,000 – whether you are at 95,000 or 108,000.
3. The limit is reset every day at midnight – from the balance. If yesterday went well, today's limit is higher. Yesterday's profit is not a cushion for today.
Example with USD 100,000 (2-Step)
| Day | Balance at 00:00 | Daily limit (equity must stay above) |
|---|---|---|
| 1 | 100,000 (initial capital) | 95,000 |
| 2 | 102,000 | 97,000 |
| 3 | 101,000 | 96,000 |
So on day 2 you may again lose at most USD 5,000 – but measured from 102,000, not 100,000.
How to calculate it yourself
- Take today's balance at 00:00 (visible in FTMO MetriX).
- Subtract 5% of the initial capital (1-Step: 3%). That is your daily limit.
- Subtract the daily limit from your current equity. That is what you can still lose today – including all open positions.
Or enter the numbers into our FTMO calculator. It shows the daily and overall limits and which one is tighter today.
And the overall limit?
Besides the daily limit there is the Maximum Loss: in the 2-Step Challenge, equity must never fall below 90% of the initial capital – 90,000 on a 100,000 account. This limit is static. In the 1-Step Challenge it trails: it sits 10% below the highest balance ever recorded at midnight and only moves up, never down.
How to practically never hit the daily limit
- Your own brake before FTMO's limit. If you only stop at −5%, there is no room for slippage, spreads or a price gap. A personal daily limit of, say, 3–4% leaves room.
- Count open risk. Add up the risk of all open positions down to their stops. If the total comes within a few hundred dollars of the daily limit, don't open anything new.
- No doubling down after losses. The trade "to win it back" is a classic way to break the daily limit.
The Constans Engine pauses at −3.5% per day and stops at −9% overall – before FTMO's limits of 5% and 10%. The brakes are built in. They are not a guarantee: they are checked at intervals, and gaps or slippage can carry a loss past a threshold.
In short
- Daily limit = balance at 00:00 CE(S)T minus 5% (1-Step: 3%) of the initial capital.
- Equity is measured, open losses count immediately.
- Reset every day; yesterday's profits raise the limit.
- The overall limit is 10%: static in 2-Step, trailing in 1-Step.