Penalties FAQ Section

Understanding Your Account Penalty

Welcome to the Penalties FAQ Section

If you are here, you have likely received an email informing you of an account penalty, and you are seeking to understand why this penalty was applied. This section is designed to provide you with comprehensive information on the various penalties that can be imposed on your account, the reasons behind them, and how to avoid similar issues in the future.

Types of Penalties

Below is a list of common penalties and the corresponding reasons for their application:

1. Account Cancellation Due to Maximum Drawdown (Max DD) Breach

If you received a penalty email indicating that your account has been terminated due to exceeding the maximum drawdown limit, please review the information below. The maximum drawdown limit is set to protect both your investments and the integrity of our trading environment.

Maximum Drawdown Rules for Simulated Funded Accounts:

Drawdown Definition: The maximum drawdown represents the largest loss allowable on your account.

Violation Criteria: Exceeding this drawdown limit at any point will trigger an automatic account termination.

Immediate Actions: Once the drawdown limit is breached, your account will be cancelled, and all positions will be closed.

Different challenge types may have different drawdown types. For more details on your specific drawdown type and drawdown limits and their implications, please refer to respective Challenge type article in our FAQ (INSERT FAQ LINK HERE). The decision to terminate the account is final and cannot be reversed. Should you have any questions or believe there was an error, please reach out to our support team via the support portal in your dashboard.

2. Account Cancellation Due to Daily Drawdown (Daily DD) Breach

If you have received an email notifying you of account termination due to a daily drawdown violation, please see the detailed explanation below. The daily drawdown limit ensures that trading activities remain within acceptable risk parameters on a day-to-day basis.

Daily Drawdown Rules for Simulated Funded Accounts:

Daily Drawdown Definition: The daily drawdown is the maximum allowable loss for your account within a single trading day.

Violation Criteria: Exceeding the daily drawdown limit will result in immediate account termination.

Immediate Actions: All positions will be closed, and the account will be cancelled once this limit is breached.

Different challenge types may have different drawdown types. For more details on your specific drawdown type and drawdown limits and their implications, please refer to respective Challenge type articles in our FAQ (INSERT FAQ LINK HERE). This termination decision is final and cannot be undone. Should you have any questions or believe there was an error, please reach out to our support team via the support portal in your dashboard.

3. Account Cancellation Due to News Trading

If you have received a penalty email indicating that your account has been terminated due to news trading, please refer to the details below. News trading is prohibited during the simulated funded phase unless the news trading add-on was purchased during the challenge phase.

News Trading Rules for Simulated Funded Accounts: High-Impact News Events

Trading Restrictions: No trades, including limit and stop orders, may be executed from 2 minutes before to 2 minutes after a high-impact news event (a total of 4 minutes).

Pre-Event Positions: Trades opened before this 4-minute window may be held; however, no account activity (including closing trades, executing new trades, stop loss triggers, or take profit hits) is permitted during this period.

Consequences of Violation: Any trading activity within this 4-minute window will result in the immediate termination of the funded agreement, account cancellation, and forfeiture of any profits.

For a comprehensive understanding of our news trading rules, please review our News Trading article in our FAQ (INSERT FAQ LINK HERE). The decision to terminate the account is final and irreversible. If you believe there has been a mistake and your account was wrongfully terminated, please open a support ticket through our support portal in your dashboard.

4. Account Cancellation Due to Copy Trading

If you have received a notification of account termination due to engaging in copy trading, please review the details below. Copy trading, which involves replicating the trades of others, is not permitted on our platform.

Copy Trading Rules for Simulated Funded Accounts:

Prohibition Details: Copy trading undermines the principle of individual trading strategies and introduces additional risks.

Violation Criteria: Accounts found participating in or benefiting from copy trading will be terminated immediately.

Immediate Actions: The account will be cancelled, and all open positions will be closed upon detection of copy trading activities.

For comprehensive information on why copy trading is prohibited, please refer to our Copy Trading article in our FAQ (INSERT FAQ LINK HERE). The termination of your account is final and cannot be appealed. If you believe there was a mistake, please open a support ticket through your dashboard.

5. Account Cancellation Due to Reverse Trading

If you received a notification regarding account termination due to reverse trading, please see the details below. Reverse trading, which involves taking positions opposite to certain market trends or signals, is prohibited on our platform.

Reverse Trading Rules for Simulated Funded Accounts:

Prohibition Details: Reverse trading can distort market analysis and lead to harmful trading behaviours.

Violation Criteria: Engaging in reverse trading will lead to immediate account termination.

Immediate Actions: Upon identification of reverse trading, your account will be cancelled, and all open positions will be closed.

For more information on reverse trading and its implications, please refer to our Reverse Trading article in our FAQ (INSERT FAQ LINK HERE). The account termination is final and irreversible. If you think there was an error, please contact our support team through the support portal in your dashboard.

6. Account Cancellation Due to Latency Arbitrage

If you have received an email indicating that your account has been terminated due to latency arbitrage, please refer to the information below. Latency arbitrage, which exploits delays in price updates between different platforms, is prohibited.

Latency Arbitrage Rules for Simulated Funded Accounts:

Prohibition Details: Latency arbitrage creates an unfair trading advantage and disrupts market integrity.

Violation Criteria: Engaging in latency arbitrage will result in immediate account termination.

Immediate Actions: The account will be cancelled, and all open positions will be closed once latency arbitrage is detected.

For further details on latency arbitrage, please consult our Latency Arbitrage article in our FAQ (INSERT FAQ LINK HERE). The termination decision is final and non-negotiable. If you believe there was an error, please open a support ticket through the support portal in your dashboard.

7. Account Cancellation Due to Account Expiry

If you received a notification of account termination due to account expiry, please see the details below. Accounts that remain inactive or unverified for extended periods are subject to cancellation. You must place at least one trade every 30 days to keep your account active.

Account Expiry Rules for Simulated Funded Accounts:

Inactivity Definition: Accounts that are inactive for a duration of 30 days or fail to complete necessary verifications are subject to termination.

Violation Criteria: Prolonged inactivity or incomplete verification will result in account termination.

Immediate Actions: The account will be cancelled if it remains inactive beyond the permitted duration.

For more information on account expiry and related policies, please review our Account Inactivity FAQ (INSERT FAQ LINK HERE). This termination is final and cannot be reversed. If you have any questions or believe there was a mistake, please contact our support team through your dashboard.

8. Account Cancellation Due to Illicit/Prohibited Trading Activity

If you received a notification of account termination due to illicit trading activity, please refer to the details below. Engaging in fraudulent or illegal trading activities, such as insider trading or market manipulation, is strictly prohibited.

Illicit Trading Activity Rules for Simulated Funded Accounts:

Prohibition Details: Illicit trading activity includes any fraudulent or illegal practices that violate our platform’s policies or legal regulations.

Violation Criteria: Detection of such activities will lead to immediate account termination.

Immediate Actions: The account will be cancelled, and all open positions will be closed upon identification of illicit trading.

For comprehensive information on what constitutes illicit trading activity, please consult our Prohibited Trading Activity FAQ (INSERT FAQ LINK HERE). The decision to terminate your account is final and irreversible. If you believe there has been a mistake, please contact our support team through the support portal in your dashboard.

9. Account Cancellation Due to Violating Terms and Conditions

If you received an email indicating that your account has been terminated due to violating our Terms and Conditions, please see the details below. Compliance with our Terms and Conditions is essential for maintaining a safe and fair-trading environment.

Violations of Terms and Conditions for Simulated Funded Accounts:

Violation Details: Violations include misuse of the platform, engaging in prohibited activities, or any actions that contravene our policies.

Violation Criteria: Breaching the Terms and Conditions will result in immediate account termination.

Immediate Actions: The account will be cancelled, and all open positions will be closed once a violation is detected.

For a detailed understanding of our terms and the consequences of violations, please refer to our Terms and Conditions. (INSERT FAQ LINK HERE). The decision to terminate the account is final and cannot be reversed. If you believe there was a mistake, please open a support ticket through the support portal in your dashboard.

10. Account Cancellation Due to Chargebacks

If you have received a notification that your account has been terminated due to a chargeback, please review the information below. A chargeback occurs when a payment made to us is disputed and reversed by your payment provider.

Chargeback Rules for Simulated Funded Accounts:

Chargeback Definition: A chargeback is a reversal of a previously completed transaction, typically initiated by the cardholder through their bank or credit card issuer.

Violation Criteria: Initiating a chargeback without prior communication and resolution attempts with our support team is considered a serious violation of our payment policies.

Consequences of Chargebacks: Unauthorized chargebacks undermine trust and result in immediate account cancellation and closure of all open positions.

Immediate Actions: Upon detection of a chargeback, your account will be cancelled, and any remaining balance forfeited, including any pending profits.

For a comprehensive understanding of our chargeback policy, including the reasons for account cancellation, please review our Terms and Conditions FAQ (INSERT FAQ LINK HERE). This resource details the implications of chargebacks and the steps you can take to address any concerns.

Contact Support: If you believe the chargeback was made in error or if you have any disputes that need resolution, please contact our support team through the support portal in your dashboard. We encourage you to reach out before initiating any chargebacks to avoid account termination.

Please be advised that the decision to terminate the account due to a chargeback is final and irreversible. We understand that this may cause unexpected inconvenience, and our team is available to assist you in resolving any related issues.

We appreciate your understanding and cooperation in adhering to our payment policies and ensuring a secure trading environment.

What to Do Next?

If you have received a penalty and wish to understand more about why it was applied, please review the specific section above that pertains to your case. Each penalty type is outlined with the reasons for its application and the behaviours that led to it.

For any additional information or if you are unable to find the answers you need in this FAQ, please contact our support team. We are committed to assisting you and ensuring that you have a clear understanding of our policies and the steps required to resolve any issues.

By understanding these penalties and the reasons behind them, you can better navigate your trading experience and ensure compliance with our platform’s rules and guidelines.

Best regards, ThinkCapital Compliance Team