Apex Trading Rules Overview
Effective Dates:
- General Rule Enforcement: Begins October 21st.
- 8-Day Trading Withdrawal: Starts November 1st.
- Safety Net Rule: Enforced from November 6th.
These rules come into effect starting October 21st, with specific elements introduced gradually. Traders can start using the 8 trading days' withdrawal on November 1st, and the safety net rule will take effect on November 6th.
Payout Structure
- No More Specific Payout Windows: Traders can request a payout anytime they meet the new requirements, removing the need for requests during specific periods (e.g., 1st-5th or 15th-20th of the month).
- New Requirements:
- Complete 8 trading days, with at least 5 of those days having a profit of $50 or more.
- Safety Net Met: The safety net is defined as the amount equivalent to the drawdown based on the account size plus an additional $100.
- Start Date: Eligible traders can request payouts under the new rules starting November 1st.
- Approvals & Funds Transfers:
- Our team will typically review and approve payout requests within 2 business days.
- Fund Transfer: Once approved, you can expect funds to be deposited into the trader's account within 3-4 business days.
- For international payments, you will receive an invitation email before your payment is processed.
- Note: After the fund transfer is initiated, it may take 3-7 business days to reflect in your account, depending on your financial institution.
Example:
- If a trader completes 8 trading days by November 1, with 5 of those days showing at least $50 profit, they can request a payout on November 1 without waiting for a specific window.
- The payout request will be processed and approved by November 5th, and the funds transfer will be initiated by November 11. Depending on the trader's bank, the funds may take 3-7 business days to appear in their account.
30% Consistency Rule
- Definition: When requesting a payout, no single trading day should account for more than 30% of the total profit balance accumulated since the last approved payout or since the start of trading if no payouts have been made.
- Forward-Looking: This rule applies going forward and does not look back after payout approval. Once a payout is made, the 30% rule resets based on the new balance.
Easy Calculation Method:
- Formula: Highest Profit Day / 0.3 = Total Profit Needed
- Example: On a $50,000 PA account, if the highest profit day was $1,500, you would calculate:
- $1,500 / 0.3 = $5,000
- This means you need a total profit of $5,000 in your account to stay compliant with the 30% consistency rule.
- If your total profit is below $5,000, you must continue trading until you reach that level to ensure compliance.
- Example: On a $50,000 PA account, if the highest profit day was $1,500, you would calculate:
Safety Net for First Three Payouts
- Applies to First Three Payouts Only: The safety net requirement must be observed for the first three approved payouts. As of the fourth payout, the safety net requirement is no longer applicable.
- Safety Net Definition: The safety net is defined as the amount equivalent to the drawdown based on the account size plus an additional $100.
- Applies to All Accounts: This rule applies to both new and existing accounts, ensuring consistency for traders as they progress.
- Minimum Payout: If you have reached the safety net threshold, you can request a payout of at least $500, even if it exceeds the safety net amount.
- Payouts Above Minimum:
- To request a payout over $500, the balance must exceed the safety net threshold by an amount equal to the additional amount requested.
Example:
For a $50,000 account, the drawdown is $2,500, so the safety net is calculated as $2,500 + $100 = $2,600.
A trader with this account reaches a balance of $52,600. The trader can request the minimum payout of $500, leaving the balance at $52,100. This is acceptable, even though it encroaches on the safety net by the $500 allowed.
To request a higher amount, for example, $1,200, the balance must exceed the safety net by the additional amount requested above the minimum of $500. In this case, the additional amount is $700, meaning the account balance must be at least $53,300. Requesting the $1,200 would leave the account balance at $52,100, which is still acceptable since it encroaches on the safety net by no more than the $500 allowed.
Probation and Payouts:
- If a trader is on probation, they can still request a payout. However, to qualify for approval, the following conditions must be met during the payout review:
- A safety net must be in place.
Any restrictions or requirements that led to the probation must be fully resolved.
100% Payout Eligibility
- Sixth Payout and Beyond: Starting from their sixth payout, traders can access 100% of their profits, even if this is achieved earlier than four months.
- If moved to a Live Prop account the trader can withdraw before their sixth payout.
- Existing PA holders already at 100% or on month 3 will not be impacted.
- Faster Access to Full Payouts: The payout maximum limit is now based on the number of withdrawals rather than a time period, enabling traders to achieve full payouts faster.
Speed Example:
- Traders can achieve 100% payouts in as few as 48 trading days (approximately two months and one week) if they follow an 8-day payout cycle.
- A trader requesting payouts every 8 trading days can receive 100% of their profits by their sixth withdrawal, within about two months and a week.
Trading Requirements
- Genuine Strategy: Traders must use a consistent, real-world trading strategy or system that reflects practices suitable for live trading.
- No Market Manipulation:
- Manipulation of the simulated trading environment, including HFT or using strategies to exploit the sim, is strictly prohibited.
- Traders must trade their own accounts and not share logins or allow others to trade on their behalf.
Dollar Cost Averaging (DCA)
Dollar Cost Averaging (DCA) involves entering additional trades in the same direction as the original order, even if the market moves against the trader’s position. As the market continues to move contrary to the trade, the trader adds more entries in the same direction.
Key Points:
- DCA is allowed under this agreement, with no restrictions on contract size for additional entries.
- There are no specific rules for determining entry points, timeframes, or distances from the original order.
- Traders must maintain responsible risk-to-reward ratios when using DCA.
- DCA is permitted as long as it does not violate any other consistency rules (e.g., 30% profit in a day, 30% negative P&L).
Traders are expected to apply DCA consistently and responsibly to adhere to the rules.
Contract Size Consistency
- Consistent Strategy:
- Contract sizes should reflect a consistent trading approach, allowing flexibility to adjust based on factors such as risk, market conditions, and volatility.
- However, erratic spikes or inconsistent changes, like trading 10 contracts one day and then 2 contracts the next solely to secure a payout, are not permitted. Adjustments made to respond to market conditions (e.g., trading fewer contracts during periods of high volatility) are acceptable.
- Adjustable Based on Strategy:
- As the account balance grows, contract sizes can be increased to reflect a scaling strategy.
- However, decreasing contract sizes should be done with a clear, strategic rationale and not in a manner that suggests inconsistency.
- Occasional adjustments based on market conditions (e.g., reducing contract size during increased volatility) are permitted, provided they align with the overall trading plan.
Scaling (Adding Positions Into Trades)
- Half Contracts Until Threshold: Traders are limited to trading half of the available contracts until they meet the trailing threshold stop.
- Full Contracts After Threshold: Once the trailing threshold is met, traders are allowed to utilize the full number of contracts permitted by their account.
Example:
- On a $50,000 account, a trader can initially trade up to 5 contracts (half the normal limit of 10). Once the account balance reaches $52,600 and the trailing stop no longer applies, they can trade the full 10 contracts.
Risk Management
- 5:1 Risk-Reward Ratio: A maximum 5:1 risk-to-reward ratio applies to all trades.
- Example: If the profit target is 10 ticks, the stop loss should not exceed 50 ticks.
- Enforcement: Violations of risk management rules may result in probation, account removal, or a warning, depending on the severity and frequency.
- Example: A trader aiming for 10 ticks of profit should not set a stop loss exceeding 50 ticks. Setting a stop loss at 100 ticks would violate the rule.
30% Negative P&L Rule
- Limit on Losses: Open trades should not exceed a 30% negative drawdown from the account’s profit balance.
- Example: For a $50,000 account, if the profit balance is $4,000, a trader should not allow a drawdown exceeding $1,200.
- New/Low Profit Accounts: For accounts that are new or have low profits, the 30% rule is based on the trailing threshold (e.g., 30% of $2,500 on a $50,000 account would be $750).
- Adjustment Based on Growth: If the account balance doubles the safety net, traders may use a 50% drawdown limit instead of 30%.
Example:
- For a $50,000 account, if you accumulate $2,600 in profit and pass the safety net, your risk is calculated based on 30% of that $2,600. If your profits rise to $5,200, your drawdown allowance can increase to $2,600 (50% of $5,200).
General Trading Practices
- Transparency:
- Apex is committed to maintaining transparency by actively monitoring trading activity for compliance.
- Traders will have access to detailed reports showing their trading practices, ensuring they can track their performance and adherence to rules. This approach promotes clarity and accountability for both the trader and Apex.
- Risk Management Priority:
- The primary focus is on encouraging responsible and sustainable trading practices that closely mimic real-world market conditions. By adhering to these practices, traders can develop strategies that are viable for live trading scenarios.
Example:
- Traders can utilize detailed reports to validate their compliance with Apex's rules and guidelines.
- If a trader's payout request is denied, they can reference specific data from their reports to verify their adherence to the rules and address any discrepancies, ensuring a clear and fair resolution process.
News Trading Practices
- One-Direction Rule:
- Apex permits traders to engage in news trading during significant market events, which can lead to rapid price movements. However, traders must adhere to a one-direction-only rule:
- Traders may take a position in either long (buy) or short (sell) during a news event.
- Holding positions in both directions simultaneously is strictly prohibited.
- Apex permits traders to engage in news trading during significant market events, which can lead to rapid price movements. However, traders must adhere to a one-direction-only rule:
- Purpose of the One-Direction Rule:
- This rule promotes discipline and focused decision-making during volatile market conditions. By preventing traders from hedging both sides, Apex ensures that all trades are based on strategic analysis rather than speculative attempts to capture moves in both directions. This approach supports clear, responsible trading practices.
- Group and Partner Trading Restrictions:
- Any attempt to bypass these rules through group or partner trading schemes will result in:
- Complete closure of all involved accounts.
- Forfeiture of funds from those accounts.
- A permanent ban from the Apex Trader Funding platform.
- Group and Partner Trading Restrictions:
- While news trading is allowed, it must still comply with all other consistency rules, such as:
- 30% profit in a day
- 30% negative P&L Traders are expected to apply their strategies consistently and responsibly. Violations of these rules will lead to review and potential account restrictions.
- While news trading is allowed, it must still comply with all other consistency rules, such as:
Example:
- A trader decides to take advantage of a major news event by entering a long position. During this period, they may not open a short position on the same instrument. This ensures that the trader remains compliant with Apex’s one-direction rule. If a trader attempts to hedge both long and short, their account will be subject to review and possible disciplinary actions, including account closure.
Flipping Trades
- Flipping is Allowed:
- Traders are permitted to engage in flipping, which means opening and closing trades quickly within the same day. This practice can count towards a trading day as long as it aligns with Apex's requirements.
- Conditions for Flipping:
- Traders must achieve a minimum profit of $50 per day.
- This must be done for at least 5 trading days to meet the eligibility criteria.
Examples:
- A trader opens and closes a few quick trades during a day, earning a $60 profit. Since this exceeds the $50 minimum profit requirement, the day counts toward the 5-day trading goal. If this pattern is repeated over the next 4 days, the trader will meet the criteria for consistent trading performance.
Summary of Core Trading Rules
Use a Genuine Trading Strategy:
- Traders must employ a consistent, real-world trading strategy that aligns with live market conditions.
DCA (Dollar-Cost Averaging) is Allowed:
- Traders can use DCA as part of their strategy, provided it is applied consistently and responsibly.
- DCA is permitted as long as it does not violate any other consistency rules (i.e 30% profit in a day, 30% negative PnL, etc.). DCA needs to be applied consistently and responsibly to satisfy the rules.
News Trading is Allowed (with Restrictions):
- Trading based on news events is permitted; however, traders cannot take opposing positions (e.g., long and short) on the same news event.
- News trading is permitted as long as it does not violate any other consistency rules (i.e 30% profit in a day, 30% negative PnL, etc.). News trading needs to be applied consistently and responsibly to satisfy the rules.
Flipping is Allowed:
- Opening and closing trades quickly to count as a trading day is permitted, as long as the $50 minimum profit for 5 days is satisfied.
Trade Half Contracts Until Trailing Stop is Achieved:
- Traders are limited to trading half of the available contracts until they meet the trailing stop threshold, encouraging careful risk management.
Maintain a 5:1 Risk-Reward Ratio on Trades:
- Ensure a maximum 5:1 risk-to-reward ratio on all trades. For instance, if targeting a profit of 10 ticks, the stop loss should not exceed 50 ticks.
Observe the 30% Drawdown Limit (Adjustable to 50%):
- Maintain a 30% drawdown limit based on the account’s profit balance. As the account grows, this limit may be adjusted to 50%, providing more flexibility as the account becomes more established.
- Example: A trader starts with a 30% drawdown limit, which can be raised to 50% once their account balance meets specified growth conditions.
Practical Example:
- A trader adhering to a defined, consistent strategy, observing the half-contract limit until the trailing stop is cleared, maintaining a 5:1 risk-reward ratio, and ensuring no drawdown exceeds 30% (or 50% if eligible) would be considered fully compliant under Apex rules.
Apex's Commitment
Fair and Consistent Rule Enforcement:
- Apex is dedicated to the consistent and objective enforcement of all trading rules. This means that rules are applied equally to all traders, without any subjective interpretation or exceptions.
- If a rule is violated, appropriate actions such as probation or denial of payouts will be clearly communicated to the trader, ensuring they understand the reason for the action taken.
Accountability for Both Parties:
- Apex is committed to maintaining full transparency, ensuring that both traders and the company are held accountable for their actions. This mutual accountability promotes a fair and reliable trading environment.
Clear Communication and Support:
- Example: If a trader's payout is denied, Apex will provide a detailed report explaining the specific rule violation. This allows traders to understand exactly what happened, why the payout was denied, and how to address or correct the issue moving forward.
Implementation Notes
- Transition Period: Traders are given time to adjust to these new rules, and the enforcement of certain rules will be gradually introduced.
- Feedback and Continuous Updates: Apex will continue to refine and provide updates on any additional rule clarifications as needed.
These rules set clear, straightforward expectations for traders under the Apex 3.0 payout and trading guidelines, fostering a transparent, responsible, and sustainable trading environment.
Understanding the 30% Consistency Rule
The 30% Consistency Rule is designed to help traders manage risk by limiting how much of their profits can be risked at any given time. Following this rule is key to maintaining a healthy trading account and avoiding large losses.
Example: On a $150,000 PA account, if the highest profit day was $2,000, you would calculate:
- $2,000 / 0.3 = $6,667
- This means you need a total profit of $6,667 in your account to stay compliant with the 30% consistency rule.
- If your total profit is below $6,667, you must continue trading until you reach that level to ensure compliance.
What is the 30% Risk Limitation (Negative PnL)?
The 30% risk rule means that your open trades should not show a negative P&L (Profit and Loss) exceeding 30% of your start-of-day profit. This applies to both individual trades and the combined value of all open orders.
Example:
If you start the day with $10,000 in profit for a $150,000 account, your open negative P&L should not exceed $3,000 (30% of $10,000). If your trades show a loss nearing $3,000, close or adjust them to prevent breaching this limit. Note, for this account size, the 30% limit would increase to 50% after $10,200 profit is made (2x $5100 safety net).
Why is This Rule Important?
This rule helps prevent traders from taking on too much risk in a single trade or leaving multiple trades open with excessive exposure. Managing risk across multiple open orders is essential to protect your trading balance.
Special Considerations for New Accounts
For accounts without significant profits or those with profits less than the drawdown amount, the 30% rule applies to 30% of the starting trailing threshold, not daily profits.
Example:
- For a $25,000 account with a $1,500 trailing threshold, the maximum risk allowed is $450 (30% of $1,500) until your profits exceed that threshold.
- For a $50,000 account with a $2,500 trailing threshold, the maximum risk allowed is $750 (30% of $2,500) until your profits exceed that threshold.
- For a $75,000 account with a $2,750 trailing threshold, the maximum risk allowed is $825 (30% of $2,750) until your profits exceed that threshold.
- For a $100,000 account with a $3,000 trailing threshold, the maximum risk allowed is $900 (30% of $3,000) until your profits exceed that threshold.
- For a $150,000 account with a $5,000 trailing threshold, the maximum risk allowed is $1,500 (30% of $5,000) until your profits exceed that threshold.
- For a $250,000 account with a $6,500 trailing threshold, the maximum risk allowed is $1,950 (30% of $6,500) until your profits exceed that threshold.
- For a $300,000 account with a $7,500 trailing threshold, the maximum risk allowed is $2,250 (30% of $7,500) until your profits exceed that threshold.
Trailing Threshold Clarification
The initial trailing threshold is used to calculate the risk limit, regardless of whether the threshold has been adjusted. Even if your trailing threshold decreases, your risk limit still references the original starting amount until you exit the safety net.
Example:
If you begin with a $2,500 trailing threshold, and it adjusts to $1,800 due to drawdown, your risk limit will still reference the original $2,500 until you pass the safety net.
Safety Net Exit
Once you exit the safety net (i.e., the trailing threshold stops), the rule shifts to 30% of your start-of-the-day profit. If your account doubles its safety net, the allowed drawdown can increase to 50%.
Example:
If you accumulate $2,600 in profit and pass the safety net, your risk is calculated based on 30% of that $2,600. If your profits rise to $5,200, your drawdown allowance can increase to $2,600 (50% of $5,200).
Temporary Exceedances
If the 30% limit is accidentally exceeded, it does not immediately mean the account is in trouble. Traders should act quickly to manage trades and return within the acceptable risk zone. If the breach is minor and corrected promptly, there is no automatic penalty.
Example:
If your P&L momentarily drops to 32%, quickly closing or adjusting positions can prevent further issues. Minor, occasional breaches corrected in a timely manner will not lead to penalties.
These terms should be strictly adhered to, ensuring consistent compliance with Apex's 30% risk management guideline.
Continuous Risk Management
Ensure your open orders’ negative P&L does not drop below 30% of your start-of-day profit. Close or adjust your trades if they approach this limit.
Example:
For a $50,000 account, if you have $4,000 in profit, don't let your open orders' losses exceed $1,200 (30% of $5,000). Adjust trades to stay within the limit.
Open Trade Management
At any given point, your combined open negative P&L should not surpass 30% of your start-of-day profit. Regularly monitor your trades and exposure to stay compliant with the rules.
Example:
If your start-of-day profit is $4,000, your combined losses from open orders should not exceed $1,200 (30% of $4,000).
Consequences of Mismanagement
Occasionally breaching the 30% limit won’t lead to immediate penalties like account failure or payout denial. However, frequent or extreme violations (e.g., exceeding 40%, 60%, or 80%) will lead to corrective action, including warnings, account suspension, or payout restrictions.
Example:
If your open P&L exceeds 30% occasionally but you quickly correct it, no penalties will be imposed. Repeatedly allowing your account to hit 60% or more due to poor risk management will trigger warnings and potential account suspension.
Consistent Oversight and Corrective Actions
Repeated violations of the 30% rule will result in notifications or account restrictions. Apex will give prior notice in case of repeated offenses to avoid unnecessary escalation.
Example:
If you continually breach the 30% limit without making adjustments, you will be notified and given the opportunity to correct the behavior. Continued violations may result in restrictions on your trading activities.
Not a Daily Loss Limit
It’s important to note that the 30% rule is not a daily loss cap. You can reach the 30% limit multiple times throughout the day, provided you take steps to stay compliant and adjust your trades as necessary.
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