"Balance-based" and "equity-based" sound like a technicality. In practice they decide whether an open trade that goes against you before working out can end your account.
The difference in one example
You are on a $100,000 account with a 5% daily limit. You open a position that moves $4,800 against you intraday, then closes at +$1,200.
| Measurement | What it saw | Outcome |
|---|---|---|
| Balance-based / EOD | A day that closed up $1,200 | No breach. Good day. |
| Equity-based / intraday | A $4,800 unrealised drawdown | Within the limit, but a $5,100 excursion would have breached you. |
Same trade, same result, completely different risk profile. Equity-based measurement penalises volatility in your entries; balance-based penalises only outcomes.
How FundedAxe measures
Daily loss is assessed on the end-of-day balance, and through every evaluation the maximum loss is static, measured from your starting balance. Neither tracks intraday equity highs or lows. Some funded accounts switch the maximum loss to a trailing limit.
Trade positions that need room
End-of-day daily loss and a static maximum loss from starting balance through every evaluation.
Frequently asked questions
What is balance-based drawdown?
A drawdown measured against your realised account balance rather than floating equity. An unrealised loss on an open position does not count against it until the position is closed or the day ends.
Is balance-based drawdown better than equity-based?
For most traders yes, especially swing traders. Equity-based measurement can breach an account on an intraday excursion that ultimately resolves in profit.
FundedAxe evaluations and funded accounts are simulated. Traders do not trade real client capital; rewards are paid on simulated performance under the terms of the FundedAxe trader agreement.