What is the Consistency Rule?

What is the Consistency Rule?

FunderPro has designed and curated the “Consistency Rule” to ensure that traders who embark on a Funded Account Challenge achieve consistent and sustainable profits, while appropriately mitigating risk. We at topFundr support this fully.

 

The Consistency Rule states that earnings from your best day cannot exceed 45% of your total profits. This rule applies during all Stages of the FunderPro Funded Account Challenges. Please be aware that the Consistency Rule does not apply to Funded Accounts.

 

What is the Significance of the Consistency Rule?

 

The importance of the Consistency Rule is that it helps identify which professional traders can attain consistent profits. This rule reduces emotion-driven trading, by ensuring that your most profitable day as a trader does not exceed 45% of your overall profit. The rule helps you become better at managing your Risk-Reward-Ratio (RRR) and develop your trading approach to be more sustainable and consistent.

 

How Does the Consistency Rule Work?

The Consistency Rule comes into action during all Stages of the Funded Account Challenge.

 

The Consistency Rule can be best explained, through the example below:

 

Imagine you purchased a Challenge Account with an Initial Balance of $100,000. In Phase 1, the Profit Target is $10,000 (10% of $100,000). We have set our Consistency Rule at 45%, therefore, you cannot earn a daily profit that exceeds $4500 (45% of $10,000).

 

To successfully pass this phase of the Funded Account Challenge, in this scenario, as a trader you would need to devise a trading approach that reaches the Profit Target of $10,000 (10% of $100,000) but does not rely on large High-Risk Trades, therefore never having a Trading Day which exceeds $4500 (45% of $10,000).

 

How Do I Calculate the Consistency Rule?

 

The Consistency Rule can be calculated as follows:

 

Account Balance x 0.1 (Profit Target 10%) = Profit Target (Amount)

Profit Target x 0.45 (Consistency Rule 45%) = Max Daily Profit

 

Ex. $50,000 (Account Balance) x 0.1 (Profit Target 10%) = $5,000 (Profit Target)

$5,000 (Profit Target) x 0.225 (Consistency Rule 45%) = $2,250 (Max Daily Profit)

 

What is the Recommended Best Day?

 

To abide the Consistency Rule your best Trading Day must remain below 45% of your Total Profit Target. We recommend that you set a Daily Profit Target that is below this maximum threshold. This will help you maintain an approach that builds consistent daily profits that abide by the Consistency Rule.

 

You can follow these examples of the Recommended Best Day based on Account Size:

Parameters: Profit Target = 10% + Consistency Rule = 45%

 

Account Size Profit Target (10%) Recommended Best Day
$10k Account $1.000 Less than $450
$25k Account $2,500 Less than $1,125
$50k Account $5,000 Less than $2,250
$100k Account $10,000 Less than $4,500
$150k Account $15,000 Less than $6,750
$200k Account $20,000 Less than $9,000

 

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