Trading & prop terms glossary

How far equity falls from a reference point, in dollars or percent.

A static floor never moves (10% below the starting balance stays there). A trailing floor rises with your peak equity and usually locks once it reaches the starting balance.

The profit you need to pass a phase, as a share of the account size.

The most equity may fall within one trading day, measured from the day's reference at the 17:00 New York rollover.

Your share of the profit when you take a reward.

Profit kept on the account above the starting balance as a cushion.

A consistency rule: your best day may be at most a set share of total profit.

Balance plus the profit or loss of open positions.

How large a position can be for the margin it uses. 1:100 means $1 of margin controls $100.

Equity divided by used margin. Below 50% the largest loser is closed.

An automated program that places trades for you.

Very fast, very frequent order placement that relies on speed rather than market view.

Holding opposite positions to offset risk.

Dollar-cost averaging: adding to a position in steps instead of all at once.

Mirroring another account's trades automatically.

Know Your Customer: verifying who an account holder is.

Trading at real market prices on an account whose orders are not sent to an exchange.

A trader who passed an evaluation and trades a funded account.