Alpha Futures Daily Loss Guard vs. Max Drawdown: The Difference

Alpha Futures has two separate drawdown rules, and confusing them will cost you accounts.

The Daily Loss Guard (DLG) locks you out for the day. The Maximum Loss Limit (MLL) kills your account permanently. One is recoverable. One isn't.

I've hit both across different accounts. Here's exactly how each works and why the distinction matters for your trading.

Learned the hard way: I've traded Alpha Futures accounts across Standard, Advanced, and Zero plans—evaluation through funded. The rule breakdowns here come from real funded trading experience, including the Daily Loss Guard locks, EOD trailing drawdown mechanics, and consistency rule math that catches most traders off guard.

The biggest trap at Alpha Futures is how rules interact—DLG locking you out before you hit max drawdown, consistency percentages changing between Standard and Advanced, and news buffer windows stacking with DLG. I broke down every rule with real examples and compliance strategies in my complete Alpha Futures rules guide. For the absolute latest, check Alpha Futures' website.

Daily Loss Guard: The Soft Breach

The Daily Loss Guard is Alpha's protective circuit breaker. Hit it, and you're done for the day—but your account survives.

How it works:

• Limit: 2% of starting account balance per trading day
• Trigger: Combined unrealized + realized P&L hitting -2%
• Result: Positions flattened, orders canceled, trading locked until next session
• Account status: Still active, trade again tomorrow

DLG by account size:

Key details:

• Resets at 6:00 PM ET (start of new trading day)
• Applies to Qualified Accounts and Zero Evaluations
• Does NOT apply to Standard or Advanced Evaluations
• Includes both closed trades and open position P&L
• Commissions and fees count against it

What happens when you hit DLG:

1. System immediately flattens all open positions
2. Pending orders get canceled
3. Account locks—no new trades possible
4. You wait until 6:00 PM ET
5. Trading resumes normally the next session

The DLG is designed to prevent you from blowing your entire account in one bad session. Think of it as Alpha saying "take a break, come back tomorrow."

Maximum Loss Limit: The Hard Breach

The Maximum Loss Limit is the account killer. Hit this and you're done—no recovery, no second chances on that account.

How it works:

• Limit: 4% trailing (Standard/Zero) or 3.5% trailing (Advanced)
• Calculation: Based on end-of-day balance high, not intraday equity
• Trigger: Account balance or floating equity touching the MLL
• Result: Account terminated permanently

MLL by account type:

How the Trailing MLL Actually Works

This is where traders get confused. Alpha's MLL trails based on end-of-day balance, not intraday highs.

Example scenario (Standard $50K):

Day 1:

• Start: $50,000 balance, MLL at $48,000
• End: Close with +$500 profit, balance now $50,500
• MLL moves up to: $48,500 (always $2,000 below EOD high)

Day 2:

• Start: $50,500 balance, MLL at $48,500
• You lose $400 during the day, close at $50,100
• MLL stays at $48,500 (doesn't go down, only trails up)

Day 3:

• Start: $50,100 balance, MLL still $48,500
• Make $1,000, close at $51,100
• MLL moves up to: $49,100

Critical point: The MLL trails from your highest END-OF-DAY balance, not your intraday equity peak. This is more forgiving than firms that trail tick-by-tick.

If you're up $2,000 at 11 AM but close flat, your MLL doesn't move. Only the closing balance matters for trailing.

When the MLL Stops Trailing

Once your MLL reaches the original starting balance, it locks permanently.

Example (Standard $50K):

• Starting balance: $50,000
• Starting MLL: $48,000
• You grow account to $52,000 EOD balance
• MLL trails up to: $50,000 (matches starting balance)
• MLL now LOCKED at $50,000 forever

This means once you've gained 4% (or 3.5% for Advanced), your MLL becomes static. You've "locked in" your starting balance as your floor. Great for protecting profits—you can't drawdown back to below where you started without breaching.

The Danger Zone: How DLG and MLL Interact

Here's where traders blow accounts: misunderstanding how these two rules work together.

Scenario 1: DLG saves you from MLL breach

Account: $50K StandardBalance: $50,500MLL: $48,500DLG: -$1,000 for the day

You lose $1,000 during the session. DLG triggers at $49,500. Account locks.

Without DLG, you might have kept trading emotionally and lost another $1,000—hitting MLL at $48,500. The DLG forced you to stop.

Scenario 2: MLL breach despite not hitting DLG

Account: $50K StandardBalance: $49,200 (after several losing days)MLL: $48,500DLG: -$1,000 for the day

You lose $800 today. DLG not triggered (only -$800, not -$1,000). But your balance is now $48,400—below MLL of $48,500. Account terminated.

The DLG is about daily limits. The MLL is about total account equity. You can breach MLL without ever hitting DLG if you've accumulated losses over multiple days.

Evaluation vs. Qualified Account Differences

The rules apply differently depending on your account phase:

Standard/Advanced Evaluation:

• DLG: NOT active (no daily limit during eval)
• MLL: 4% or 3.5% trailing from EOD balance
• Result: More freedom during evaluation, but one bad day can still kill you

Zero Evaluation:

• DLG: ACTIVE at 2%
• MLL: 4% trailing from EOD balance
• Result: Tighter daily control, harder to blow account in one session

All Qualified Accounts:

• DLG: ACTIVE at 2%
• MLL: Continues trailing until locked at starting balance
• Result: Built-in protection, but both rules can end trading

The absence of DLG during Standard/Advanced evaluation is intentional. Alpha wants to see how you manage risk without training wheels. Can you avoid blowing up without forced daily limits?

Withdrawal Impact on MLL

This catches people off guard. Withdrawing profits affects your MLL math.

Example:Account: $50K QualifiedCurrent balance: $55,000MLL locked at: $50,000

You withdraw $4,500 (90% of $5,000 profit after split).

New balance: $50,500MLL still: $50,000

You now have only $500 cushion above MLL. One bad day could breach you.

Worse scenario:You withdraw the full $5,000 profit.New balance: $50,000MLL: $50,000

You've breached MLL. Account closed.

Alpha explicitly warns about this: withdrawals contribute to your MLL. Don't withdraw yourself into a breach.

Practical Risk Management

Given both rules, here's how to stay safe:

For evaluations (Standard/Advanced with no DLG):

• Self-impose a personal daily loss limit (I use 1.5%)
• Don't rely on having no DLG—treat it like you have one
• Stop trading after 2 consecutive losers
• Never try to "make back" a losing day in one session

For evaluations (Zero with 2% DLG):

• The DLG is protection, not a target
• Plan trades to risk well under 2% per day
• Remember DLG locks you out—you can't recover same-day

For Qualified Accounts (all types):

• Track your MLL distance daily
• Never withdraw to within $500 of MLL
• Use DLG as your mental limit, not a goal
• Build cushion before taking significant payouts

Comparison Chart: DLG vs MLL

Bottom Line

The Daily Loss Guard is your friend—it stops bad days from becoming account-ending disasters. Hit it, accept it, come back tomorrow.

The Maximum Loss Limit is the final line. Cross it and you're done. No appeals, no resets, no second chances on that account.

Understand both. Respect both. And most importantly, never confuse a DLG lockout (temporary) with an MLL breach (permanent). The difference is your entire account.

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