# Drawdown

> The loss limit on an account, measured from a reference balance. Breaching it ends the evaluation or the funded account.

**Source:** https://proptechpal.com/glossary/drawdown  
**Generated:** 2026-09-24  
**Publisher:** Prop Tech Pal — independent prop firm technology comparison

_Disclosure grades measure what a vendor publishes, never product quality. A vendor publishing a weak SLA scores better than one publishing none._

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Also called: maximum drawdown

## Why it matters

How the reference point is set — fixed, trailing or end-of-day trailing — changes both how hard the rule is and what the risk engine has to compute.

## Where it applies

- [Prop firm risk management software](https://proptechpal.com/categories/risk-management)

[The full glossary](https://proptechpal.com/glossary)