What is a daily loss limit?

How it typically works:

• The limit is set as a percentage, for example 5%.
• Each day has a reference value, the day's opening figure.
• If equity falls by the limit below that reference, the account breaches.
• The reference resets at a fixed time each day.

Details that cause disputes:

• Which reference: starting balance, opening balance, or opening equity.
• Floating losses: whether open trades count (most firms say yes, by using equity).
• Reset time: the exact hour and time zone.

PropExecutor's daily loss limit is measured on equity against the day's opening figure, resets each UTC day, and opens each day on the higher of balance and equity at the roll.

Worked example

A $50,000 account with a 5% daily limit opens the day at $50,000. The floor is $47,500. If equity, including open positions, touches $47,500 at any point that day, the account breaches, even if prices recover a minute later.