The vocabulary of prop futures trading.

A drawdown rule whose threshold moves up with every new equity high during the session, locking traders out of giving back winners.

A drawdown rule calculated once per day on your closing balance — intraday volatility doesn't count.

The maximum dollar amount you can lose in a single trading day before the account is breached.

A self-imposed limit inside the firm's actual limit — your guardrail before the firm's guardrail.

The ratio of potential profit to potential loss on a single trade — typically expressed as 1:N where N is the multiple of risk you're targeting.

The process of determining how many contracts to trade on a given setup, typically based on a fixed-dollar risk and the stop distance.

An automated trigger that closes all open positions and cancels working orders when a defined risk condition fires.

A time-based trigger that flattens the account and disables trading at a configured Eastern Time each day.

A protective pair of orders — a stop loss and a profit target — attached to an entry as a one-cancels-other group.

A stop loss adjustment that moves your stop to your entry price (plus an offset) once the trade has reached a defined favorable condition.

A pre-planned partial exit at a price level less than the full target — typically used to bank some profit and reduce risk on the remaining position.

The smallest allowable price increment for a given futures contract — and the unit most prop traders count P&L in.

The difference between the price you expected to fill at and the price you actually got — usually worse than expected, especially in fast moves.

The volume of orders available at each price level — deeper liquidity means smaller slippage and more reliable fills.

An order to buy at a specified price or lower, or sell at a specified price or higher — only fills if the market reaches that price.

An order to buy or sell immediately at the best available price — guaranteed fill, no guarantee on price.

An order that becomes a market order once a trigger price is hit — most commonly used to limit losses on an open position.

A pair of orders linked so that when one fills, the other automatically cancels — the foundation of a bracket order.

A one-click trading-lockout that disables order entry until the next session — designed to prevent revenge trades after a triggering event.

A numerical score that measures plan adherence on every trade — inputs, not outputs — so you can see whether you're actually getting better.

A trade taken to make back a previous loss, typically sized larger than plan and taken with weaker setup criteria.

An emotionally compromised state where trading decisions deviate from the plan — usually triggered by a loss, a missed setup, or a target cut short.

A trading account provided after a prop firm evaluation or approval process where the trader keeps a profit share while operating under defined risk rules.

The simulated trading challenge a prop firm uses to qualify traders for a funded account.

The minimum cumulative profit required to pass an evaluation or progress to a funded account.

A rule limiting how much of total profit can come from one day, usually 30-50%, to reward steadier evaluation results.

The size category of a funded account at a prop firm — different tiers have different starting balances, drawdown limits, and rule sets.

The percentage of profits the trader keeps when a payout is requested from a funded account.