At first, let's review the concept of Equity drawdown, Floating drawdown and Total loss:

• Equity drawdown: the difference between the maximum equity and the minimum equity (%).
• Floating drawdown: the difference between the maximum balance (or maximum equity if the account is always negative from the beginning) and the minimum equity (%).
• Total Loss: the difference between the initial balance and the minimum equity (%).

Now, let's come to an example of how Trader's Guard handle your trading account in case you commit EDD = 15%/FDD = 15%/Total Loss =15% through the following chart:

The chart above shows the equity levels that trigger Trader's Guard with the condition EDD = 15%/FDD = 15%/Total Loss =15%. Accordingly, there are 4 trigger times as follows:

1. Trigger Time 1

Initially, B = E = 1000.

• The equity that triggers Trader's Guard EDD = 15%:
  $1000 (E-max) * ( 1 - 0.15) = $850
• The equity that triggers Trader's Guard FDD = 15%:
  $1000 (B-max) * ( 1 - 0.15) = $850
• The equity that triggers Trader's Guard Total Loss = 15%:
  $1000 (B-initial) * ( 1 - 0.15) = $850

That decrease of equity to $850 will activate the Trader's Guard in all 3 cases EDD, FDD and Total Loss. At this point, all open positions will be closed. Simultaneously, trading will be disabled during the penalty time.

2. Trigger Time 2

Equity then increases to $1100. Now, E = 1100 and B = 1000.

• The equity that triggers Trader's Guard EDD = 15%:
  $1100 (E-max) * ( 1 - 0.15) = $935
• The equity that triggers Trader's Guard FDD = 15%:
  $1000 (B-max) * ( 1 - 0.15) = $850
• The equity that triggers Trader's Guard Total Loss = 15%:
  $1000 (B-initial)* ( 1 - 0.15) = $850

When equity decreases to $935, only the Trader's Guard trigger line for EDD does change. The Trader's Guard trigger line for FDD does not change because B-max is still 1000 (user hasn't yet closed orders). The Trader's Guard trigger line for Total Loss does not change during monitoring.

3. Trigger Time 3

Equity then increases to $1150 & user takes profit. Now, B = E = 1150

• The equity that triggers Trader's Guard EDD = 15%:
  $1150 (E-max) * ( 1 - 0.15) = $977.5
• The equity that triggers Trader's Guard FDD = 15%:
  $1150 (B-max) * ( 1 - 0.15) = $977.5
• The equity that triggers Trader's Guard Total Loss = 15%:
  $1000 (B-initial)* ( 1 - 0.15) = $850

When equity decreases to $977.5, Trader's Guard trigger line for EDD & FDD will change. The reason is that user has already closed orders (E-max = B-max = $1150). The Trader's Guard trigger line for Total Loss still does not change during monitoring.

4. Trigger Time 4

Equity then increases to $1175. Now, E = 1175 and B = 1150.

• The equity that triggers Trader's Guard EDD = 15%:
  $1175 (E-max) * ( 1 - 0.15) = $998.5
• The equity that triggers Trader's Guard FDD = 15%:
  $1150 (B-max) * ( 1 - 0.15) = $977.5
• The equity that triggers Trader's Guard Total Loss = 15%:
  $1000 (B-initial)* ( 1 - 0.15) = $850

When equity decreases to $998.5, only Trader's Guard trigger line for EDD does change. The Trader's Guard trigger line for FDD does not change because B-max is still $1150 (user hasn't yet closed orders). The Trader's Guard trigger line for Total Loss also does not change during monitoring

Conclusion

From the above example, we draw similarities and differences between these types of commitments.

1. Similarity:

They are monitored & triggered as per the equity's fluctuation.
2. Differences:

• The Trader's Guard trigger line for EDD will change when equity increases to a new peek.
• The Trader's Guard trigger line for FDD will change when users close a profitable order.
• The Trader's Guard trigger line for Total Loss does not change during monitoring.