Limits, breaches and payouts

Everything that can refuse a trade, use up your day's room, end your seat, or pay you. Three minutes. Note which of those is which: running out of room for a window is temporary, and both of the limits you can breach end the seat.

The same rules apply on the evaluation and on the funded seat. What you learn in the challenge stays true after you pass.

Every number below comes from packages/core/src/tier-terms.ts; your own seat carries its copy on chain and you can read it yourself. Checking it yourself is the method.

Read the drawdown against the money, not the label. $250 is the whole of what Fortell reserves against your seat and the whole of what a seat can lose. A smaller percentage on a bigger account is not a looser rule.

#1. The four limits

Two are guardrails and two end things. You cannot breach a guardrail, because the order is refused before it happens.

The two terminal limits do not treat their own boundary the same way, and the difference is deliberate rather than an oversight.

Reaching the drawdown is breaching it. Down exactly $250 from your peak is a drawdown breach. Not $249.99. Nothing you can do puts you past that floor, so reaching it exactly is the whole of the event.

Reaching the daily limit is not. Down exactly $125 on the day is not a daily breach. Your run does not end and a funded seat does not freeze. The day fails at $125.01, not at $125.00. Standing exactly on the limit you are out of room for the day, but you are not out of the seat, and 00:00 UTC gives the room back.

Why the two differ. The daily limit is pacing. A seat that has spent its day gets the whole day's room back at 00:00 UTC, so ending it at the boundary would end a seat the rule only meant to slow down. The drawdown is capital: behind that floor sits the first-loss cover Fortell reserved against your seat and nothing else, so exposure may never exceed the room left to it. One rail strict and the other inclusive is the same asymmetry as the overshoot rule in section 2, and it exists for the same reason.

Both comparisons are the same on the evaluation and on the funded seat. Down exactly $125 on the day, the challenge does not fail you and a funded seat does not freeze. Down exactly $250 from your peak, both end. That agreement is the promise at the top of this page, and it is why the daily test is the strict one and the drawdown test is not.

A daily breach ends the seat. Not the day - the seat. On the evaluation it fails the challenge; on a funded seat it stops the seat from opening another position. This is stricter than the industry, where a daily breach usually costs you the rest of the day and nothing else, and it was chosen deliberately: a $125 day is half of everything Fortell has reserved against your account, so a trader who reaches it twice has spent the whole budget, and the second time would be a rule that only pretended to be a limit the first time. (A few test cohorts run a shorter day. Your seat carries its own bucket length and every screen shows it.)

A drawdown breach ends the seat. Permanently. The seat can still close positions and still pay out what it owes you, but it can never open another one and nothing re-arms it. The only forward path is settle, then close.

Both terminal limits end the same way and neither one strands a cent. Closing a position, claiming your profit and settling are all still available after a breach. What ends is your permission to open something new.

The floor is a fixed distance below your peak, not a percentage of it. This is worth being exact about, because the two behave differently and the difference is yours:

drawdown floor = max( hold line , peak ) - room

room is the loss room your level allows, and it is $250 at the bottom level. peak is the highest your seat has ever been worth, and it only moves up. hold line is the equity your level requires you to keep, and it is $0 at the bottom level, so at the bottom the floor is simply peak - $250.

Run to $250 of profit and fall back and your floor has moved up with your peak by the same $250. The room does not shrink as you win and it does not grow as you win; it is a constant distance, and a level changes it deliberately rather than as a side effect of profit.

Profits restore room. Daily loss is net for the day, so trading back into profit gives the day's room back. Make $10 in the morning on a $125 daily limit and you have $135 of room for the rest of that day. This is the FTMO and FundedNext design and it already works.

Exits are never blocked. No limit refuses a close, on any venue, in any state.

#2. The overshoot rule

The three loss limits interact. The binding number is not the open cap on its own:

effective open cap = min(
    open cap,                  # the configured ceiling            $200
    daily room + trade cap,    # overshoot the DAY by one trade, at most
    drawdown room              # NEVER overshoot the drawdown
)

The asymmetry is deliberate. One limit may be overshot by exactly one trade and the other may not be overshot at all.

The open cap is a backstop, not the everyday rail. On a flat day the middle term is $125 + $50 = $175, which is under the $200 ceiling, so the daily limit is what decides your size and the open cap only starts binding on a day you are already $25 or more in front - because profit gives the day's room back. That is what the $200 is for: at $100 the ceiling would have been the tightest of the three on every ordinary day, and it would have quietly made both the daily limit and the overshoot below unreachable.

#Worked

You have lost $100 so far today against a $125 daily limit. Your daily room is $25. Your trade cap is $50. Your drawdown room is wide.

effective open cap = min($200, $25 + $50, wide) = $75

So you may carry $75 of worst case against $25 of daily room. Starting flat, your first order is capped at $50 by the trade cap; a second order of $25 puts you on the effective open cap. Both are legal and both are allowed, even though the $50 one alone is already more than your remaining daily room.

If it all goes to zero you end the day $175 down: $100 already lost plus $75 open. That is $50 past your $125 daily limit, which is exactly one trade cap.

You knew before you clicked. That is the whole point of the rule.

The bound holds on every path, not just this one. The most you can be down at the end of any day is daily limit + one trade cap, because the effective open cap already has your realised loss subtracted from it.

The drawdown gets no such allowance. Exposure can never exceed the room you have left to your floor, so the floor can be reached exactly and never passed.

Why they differ, and it is not that one is survivable. A daily breach ends your seat, so there is nothing survivable about overshooting the day either. The overshoot is about permission, not survival.

Without it, $25 of daily room means the largest order you may place is $25 - so a $50 trade, a size this account plainly allows, is simply not available to you, and the rule that took it away is the loss limit rather than the trade cap. With it, the $50 trade is yours to take. If it loses, your seat ends, and you were shown the number before you clicked.

The drawdown gets no allowance because there is no equivalent decision to hand you: past the floor there is no capital left to risk, and it is not yours. So the asymmetry is about who decides - you, against a limit you can see, or the program, on your behalf - and not about who survives.

#One more thing the daily limit does

A position that could still be open when the day rolls over is charged against tomorrow's room as well as today's. Nothing knows when you will close, so both days are asked. Tomorrow has no realised loss yet, so its room is the full daily limit.

#3. What Fortell can lose

The drawdown number is the number Fortell reserves as first-loss cover before your seat is funded. The program refuses to move capital into a seat whose cover is not already sitting in the pool. That is why the maximum a seat can lose and the cover reserved for it are the same figure, and why a losing seat can never reach backer principal.

And it stops being reachable at all once your seat scales. From the first level above the bottom, the equity you must hold exceeds the capital in your seat, so the money standing in front of Fortell's cover is your own retained profit. The bottom level is the only level at which Fortell can lose a cent.

#4. What you see, and when

A rule that only exists in code is not a rule you can act on.

Before every order, you see:

1. The largest order you may place right now. One number, computed from every limit at once, off the same state that refuses orders. If it says $12, then $12 passes and $12.01 does not.

2. Which limit is binding, and when it lifts. "$25 of your $125 daily limit is left. Resets at 00:00 UTC" is actionable. "Order refused" is not.

3. Your room to each of the four limits, in dollars. Trade, open, daily, drawdown. All four, all the time, not just the one that happens to bind.

When you breach, you are told which limit, by how much, and what it cost. Both breachable limits end the seat, so there is no "or just your day" to work out.

What is not built yet, stated rather than implied. Items 1 and 2 exist on the evaluation. Item 3 is half built: your drawdown room is published on the wire and no trading screen renders it yet. There is no funded-seat trading screen in the web or phone apps at all today, so a funded trader reaches the pre-trade figures through the agent interface rather than a terminal. None of that changes what the program enforces, and none of it is a rule you can be caught out by; it is a question of which surface tells you first.

#5. Getting paid, and what it costs you

#Levels move your limits, not your money

The funded seat has no profit target. There is nothing to hit, no deadline, no bar you fail by missing. The target belongs to the evaluation and it stays there.

What profit does on a funded seat is unlock bigger limits. Your seat sits on a level of a ladder. Each level above the bottom names a profit milestone and grants a bigger trade cap, a bigger open cap, a bigger daily allowance and a shorter minimum hold, and it widens the room your losses have before the seat ends. Reach the milestone while still holding the gains and the level is yours, signed by you or by Fortell.

On the account on sale today that first milestone is a doubling. The seat is funded with $250 of cash, and the first level above the bottom needs $500 of equity standing in it. That is the largest step this ladder can ask for, and it is that large for a specific reason: the milestone is the loss room your level already allows, and on this seat that room, the $250 above, is exactly the cash you were funded with. Profit you have already claimed does not count toward it.

A level moves no money. It does not raise your seat size, it does not raise the maximum drawdown you are held to, it does not add capital, and it raises nothing Fortell has at risk. The program proves that on every promotion by capturing ten fields before the write and refusing the transaction if any of them moved. A level grants permission, and the wider room is funded by profit you already made and are still holding, and by nothing else.

So the decision is yours: take the money out, or leave it in and trade bigger. That choice is the product. It is not a trick question and there is no right answer, but you should know the price before you make it, which is the next part.

#A claim that would take you below your hold line is refused, not charged

Every level above the bottom has a hold line: equity you must keep in the seat to stay on it.

You choose how much to claim. Everything above the hold line is yours to take at any flat point, on your own signature, in whatever amount you want. A claim that would leave the seat below the line is refused on chain rather than paid out, so a withdrawal can never cost you a level. Nothing is taken and nothing is forfeited: the money stays in your seat and is claimable again the moment you are above the line.

At the bottom level the hold line is $0, so the whole of your profit is claimable.

Falling below the hold line by TRADING does cost a level, and anyone may trigger that. A demotion is one level per call, moves no money, and cannot strand capital or freeze a seat. Climb back by making the milestone again.

#When you can claim

Two conditions, both checked by the program and not by a person.

• You must be flat. With a position open, your seat's value is whatever the venue says the outcome tokens are worth, and the program will not trust a price feed for that. Flat, your seat's value is simply the cash in it.

• There must be profit, meaning cash above your basis: the principal actually loaded into your seat. If there is none, the program says so rather than paying out nothing.

No minimum, no waiting period, no approval, nobody to ask.

#It is permissionless past your seat's grace window, and that is the moat

Your signature authorises a claim. No Fortell key is in the instruction at all, so no Fortell key can approve, delay or refuse it.

Once your seat has sat flat for longer than its grace window, any wallet may submit your claim for you. That window is a term of your own seat rather than a global setting somebody can move under you: it is written onto the seat account when it is funded, it is part of the immutable record your challenge was sold under, and it is 48 hours on the account this page describes. Read it off your seat rather than trusting this sentence.

That sounds like a weakening and it is the opposite. Every destination is pinned on the seat itself: your share to your address, the fee to the treasury address written on the seat, the pool leg to the pool address written on the seat. A stranger calling it cannot redirect a cent. All they can do is cause the same split you would have caused, and they cannot take the seat below your hold line either, because that claim is refused whoever signs it.

It exists so a trader who walks away cannot leave their own money stranded in a dormant seat.

#The split

These are configuration, not a constant. They are the terms your seat was opened under. They are written into the seat when it is funded, checked against the immutable published record your challenge was sold under, and no later edit to any table moves them. An account published tomorrow may split differently. Your seat keeps this one for as long as it exists.

Backers take no share of your trading profit, and no share of anything else yet. The pool's row is 0% and that is deliberate. A mechanism to pay backers out of challenge fee revenue instead is built on chain, and it is switched off. No rate has been set and no pool has been pinned on any deployment, so every sale accrues zero and no backer has been paid. Were it switched on, it would bind a share to each sale at the moment of purchase, so a later rate change would reach future sales only. Trading well never costs you more and trading badly never costs them principal.

#Unclaimed profit is still at risk

Money above your basis is equity, not a balance owed to you. Up $200 and then down $125 leaves you $75 of profit, not $200.

#Closing a seat forfeits nothing

close_vault refuses while any claim is outstanding. Unclaimed profit blocks the close rather than being swept by it. A sweep back to the pool pays you first and can only ever move principal. Nothing is forfeited, ever, on any path.

That cannot deadlock, because the claim is already permissionless past the grace window with every destination pinned. Anyone who wants the close can first release your money to you.

Getting paid is the shorter version of section 5. The risk rails explains what each limit is for and exactly when it refuses you. How a challenge is graded covers the evaluation's own five criteria, which are a different list from the four limits above.