How do the max daily and max total draw downs work?

The maximum daily loss on the account consisting of the account’s current result of opened positions and the result of positions closed on the given day must not at any time in the course of one working day exceed 6% of the initial balance of the account. For the max total draw down, the equity of the account must not fall below 88% of the initial account balance both for open and closed positions, including commissions and swaps.

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CFTC Rule 4.41

Hypothetical or simulated performance results have certain limitations. Unlike an actual performance record, simulated results do not represent actual trading. Also, because the trades have not actually been executed, the results may have under-or-over compensated for the impact, if any, of certain market factors, such as lack of liquidity. Simulated trading programs, in general, are also subject to the fact that they are designed with the benefit of hindsight. No representation is being made that any account will or is likely to achieve profit or losses similar to those shown. CFTC Rule 4.41

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