The Consistency Rule is a safeguard for the funded stage to ensure that traders maintain a sustainable trading approach over time. It prevents traders from relying on a single large gain to dominate their account's profit distribution.
Key Concepts
1. Purpose
The rule promotes long-term, stable trading performance by encouraging traders to spread their profits consistently across multiple days rather than relying on high-risk trades.
2. Applicability
The Consistency Rule only applies:
In the funded stage (not during the challenge phase).
Even when the account is in drawdown.
3. Calculation
The Consistency Percentage is calculated as:
Consistency Percentage = (Most Profitable Day / Total Profit in Account) × 100
Example Calculation
Scenario:
A funded account shows a total profit of $1,000, and the trader’s most profitable day recorded a gain of $450.
Consistency Percentage = (450 / 1000) × 100 =45%
The set threshold for consistency is 50%, the trader meets the requirement and can withdraw profits.
Exceeding the Threshold:
If the most profitable day exceeds 50% of the total profit, the trader must continue trading until the ratio falls below the threshold.
When the Account is in Drawdown
The Consistency Rule still applies when the account is in drawdown. In this case:
Profits are measured from the initial account equity, not the reduced balance.
Any recouped losses are not considered “new profits.”
Threshold Setting
TopTier Trader sets a specific percentage threshold (50%). This percentage determines the maximum allowable contribution of a single day’s profit to the total profits.
Non-Failure Consequences
Exceeding the consistency threshold does not result in failure. Instead:
The trader must continue trading to rebalance their profit distribution.