Consistency Rules and News Trading Rules

Consistency rules

The usual form: no single trading day may account for more than a set share of the profit you are claiming. If the cap is 40 percent and one day made 3,000 dollars, you need at least 7,500 dollars of total profit before a payout or a pass. The rule does not close the account; it delays the pass or the payout until the ratio is met, which means grinding out more profit or, at some firms, accepting a reduced payout. It punishes gamblers, and it also punishes traders whose edge is a few big days a month.

News trading rules

• The window: typically from two to five minutes before a scheduled high-impact event until two to five minutes after.
• The events: usually those marked high impact on the firm's chosen calendar, always including central bank decisions and US employment data.
• The action: no opening, closing or modifying positions in the window at strict firms; no opening only at lenient ones. Holding through the window is sometimes allowed, sometimes not.
• The penalty: profit from a breaching trade voided, or the account closed.

Why the rules exist

Both protect the firm from outcomes that are luck rather than skill, and from strategies, such as straddling news with stop orders, that produce large simulated profits the firm could not hedge in a real market. They are the firm's version of a casino's table limits.

Avoiding accidents

Know the firm's calendar and time zone; the window is defined by the firm's clock, not yours. Do not hold pending orders through a window if the rule counts fills. If a consistency rule exists, watch the ratio on the dashboard and stop enlarging a great day. And remember that the rules for the evaluation and the funded account can differ, usually stricter on the funded account, where real money leaves the firm.

Key takeaways

• Consistency rules cap the share of profit from one day; they delay rather than fail.
• News rules forbid trading in a window around high-impact events, on the firm's clock.
• Both protect the firm from luck and unhedgeable strategies.
• Check both rules separately for the evaluation and the funded stage.