How Does the Overall Drawdown Work?

When you embark on a Cove Funded Funded Account Challenge, throughout the challenge, the capital in your Cove Funded Trader Account can never, at any given time, fall below 10% for the 2 Phase Challenge. 

An example of the Overall Drawdown would be: 

If a trader has a Cove Funded Trading Account with a starting balance of $100,000, the Overall Drawdown would be $10,000 (10% of $100,000). This means that the trader’s Account Balance can never fall below $90,000 throughout the entire Funded Account Challenge. 

How Do I Calculate the Max Overall Drawdown? 

The Max Overall Drawdown can be calculated as follows: 

Initial Account Balance x [0.10] = Max Overall Drawdown. 

Ex. $200,000 x [0.10] = $20,000 (Max Overall Drawdown) (Max Loss). 

Note: Exceeding the Max Overall Drawdown of 10% will result in the automatic failure of that respective challenge attempt. The Overall Drawdown rule applies to both two phases of every Funded Account Challenge (Phase 1: Evaluation and Phase 2: Verification). 

Note: Cove Funded, does not recommend trading one hour before and after the Market Rollover, due to bad market conditions caused by low liquidity and high volatility.