This post is about critical aspect of Tradeify’s funded accounts: the 20% Consistency Rule. This rule is especially relevant for traders using Tradeify’s Straight-to-Funded option, which skips the challenge phase. In this post, I’ll explain how the rule works, provide practical examples, and share tips on how to navigate it effectively.
What Is the 20% Consistency Rule?
In Tradeify’s Straight-to-Funded accounts, the 20% Consistency Rule limits the profit on your highest trading day to no more than 20% of your total earnings over the trading cycle. This rule encourages consistent trading rather than relying on a few high-profit days to reach your payout target.
For example, if your total profit over 10 trading days is $10,000, your highest single-day profit cannot exceed $2,000 (20% of $10,000). If you exceed this limit, you’ll need to continue trading to balance your results and bring your consistency ratio back in line with the rule.
How It Works: A Step-by-Step Example
Here’s how the consistency rule applies across a trading cycle:
- Set Your Total Profit Goal: For example, let’s say your total profit after 10 trading days is $10,000.
- Calculate the 20% Threshold: In this case, 20% of $10,000 is $2,000. This is the maximum profit you can make on any single day within this cycle.
- Check Your Highest Profit Day: If your best trading day earned you $2,100, that’s 21% of $10,000, which exceeds the 20% threshold. As a result, you won’t be eligible to request a payout yet.
To correct this, you’ll need to trade additional days with smaller profits to balance your results and bring your highest day’s percentage down to 20% or lower.
Practical Examples of the Consistency Rule
Here’s a breakdown of scenarios to help clarify:
- Scenario 1: Total profits over 10 days = $10,000
- Highest single-day profit = $2,100 (21%)
- Outcome: Consistency rule not met; additional trading required.
- Scenario 2: Total profits over 10 days = $10,000
- Highest single-day profit = $1,900 (19%)
- Outcome: Consistency rule met; eligible for payout.
By keeping your highest day’s profit within 20% of your total cycle profit, you can ensure your consistency is on track and avoid extra trading days to balance out your performance.
Tips for Managing Consistency
- Aim for Steady, Small Profits: It’s often easier to hit consistency targets by making steady profits rather than big gains. If you’re targeting $7,600 in profits, aim for around $760 per day over 10 days to stay within range.
- Adjust Your Strategy Near the End of the Cycle: If you’re approaching the end of your 10-day trading cycle and your consistency is slightly off, extend your cycle by a few days rather than risking a big trade. By spreading your profits across more days, it becomes easier to keep your largest day within the 20% limit.
- Control Your Trades: To stay within the 20% limit, avoid letting winners run too long or aiming for large trades, as these can spike your profits on certain days. With prop firms, it’s crucial to prioritize consistency over maximizing each trade.
- Use a Spreadsheet: To keep track of your daily profits and make sure you’re within the 20% consistency rule, download a consistency tracking spreadsheet. By logging your daily gains, you can adjust your trades as needed to stay on track.
What Happens After Each Trading Cycle?
After each trading cycle, your consistency resets. This means once you reach your payout and begin a new cycle, your consistency percentage doesn’t carry over. You’ll start fresh with a new consistency threshold, giving you a clean slate for the next round of trades.
Final Thoughts
Tradeify’s 20% Consistency Rule is designed to encourage disciplined and steady trading. By spreading profits across multiple days, traders can avoid large, inconsistent gains and maintain eligibility for payouts. If you’re approaching the end of a cycle and struggling with consistency, take your time, add extra trading days if necessary, and aim for gradual growth.
For more trading tips, strategy guides, and a community of like-minded traders, feel free to join my Discord. Happy trading, and may your journey with Tradeify be a profitable one!
