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In my opinion, the biggest benefit is allowing you to trade what feels like a real account, without you trading your real account and blowing it up. As a beginning trader, the chances of blowing up an account is very high. SIM doesn't provide the real world feel. I think TST does a good job of landing in the middle.
Thanks. Just to clarify, this is a quote from the the website.
"The Trailing Max Drawdown is calculated from your account balance high. So, if you make $500 on the first trading day your account balance will be $50,500 which will make your Trailing Max Drawdown $48,500 ($2,000 from the account balance high). If you were to lose $500 the next day your account balance goes back to $50,000, but your minimum account balance will remain $48,500."
This sounds like realized. They are assuming that the target was filled with limit order. Even then most of the time market has to tick through in order to get filled. From above example, if the market goes up +$700 (unrealized) and came back +$500 (realized) my minimum account balance would be $48,700 not $48,500.
In the Combine, the drawdown is based on the realized end of day balance. You are required to close at the end of day, so there is no unrealized end of day balance -- you can have no open trades after the close.
During the day, you can exceed the trailing max drawdown on either a realized or unrealized basis:
The other loss rule to be aware of is the daily loss limit, which is calculated on an UNrealized basis, so you will be knocked out if your current trade exceeds the limit at any time:
"Realized" has nothing to do with what type of order is filled. It has to do with whether the trade is open or not. Once you are filled, you have an unrealized profit or loss until you close the trade, at which time your P/L is realized.
Your account balance for the max drawdown is your realized balance at end of day, when all trades have been closed.
Except the emotions of having real monty on the line. No sim can ever totally duplicate that. But you do have some emotion from TST because you are trying to pass the combine.
I got a PM from @skfutures with an excellent question. Basically, it is not clear from what I could find on the website whether, in the funded account, the new trailing max drawdown itself is computed the same way as in the Combine -- based on closing balance -- or on the high point reached during the day, realized or not.
So if his high point was +900, but he ended up at +700, which amount would be used, in the funded account, to calculate his new trailing max drawdown? Also, if the +900 was unrealized, would it be used, or would they use the highest realized balance?
I don't know, and it would be important to know, obviously.
I'm quoting from my reply to him, so the question will be out in the public space of the forum for others to see, and perhaps answer:
I got a PM from @skfutures with an excellent question. Basically, it is not clear from what I could find on the website whether, in the funded account, the new trailing max drawdown itself is computed the same way as in the Combine -- based on closing balance -- or on the high point reached during the day, realized or not.
So if his high point was +900, but he ended up at +700, which amount would be used, in the funded account, to calculate his new trailing max drawdown? Also, if the +900 was unrealized, would it be used, or would they use the highest realized balance?
I don't know, and it would be important to know, obviously.
I'm quoting from my reply to him, so the question will be out in the public space of the forum for others to see, and perhaps answer:
As a recent funded trader i can tell you it calculates it from ur account high at the end of the day/close not your account high during the day.
So if you were up $1000 during the day and by the time the markets closed you were only at $700 then they would only use that $700 in there calculations not the $1000.
Hope that helps
Thank you to everyone who helped me in my journal contest it all ment alot.