Lux Trading Firm $400,000 Challenge — Position Size Calculator

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Firm Rules Summary

Risk Guide

Lux Trading Firm's $400k account presents a unique risk scenario with zero daily loss limit but a strict 6% max drawdown of $24,000. The consistency rule caps each trade at 5% of your remaining risk capital, which starts at $24,000 on day one, meaning your maximum initial position risk is $1,200. This is significantly more conservative than typical 1-2% risk models. If you lose your first trade risking the full $1,200, your remaining risk capital drops to $22,800, and your next maximum risk becomes $1,140. This cascading effect means position sizes must decrease with each loss. For practical position sizing on EURUSD with a 30-pip stop (roughly 3 points), risking $1,200 allows approximately 4 standard lots initially. On ES futures with a 10-point stop, you could trade roughly 12 contracts at maximum risk. The math changes dramatically as you take losses - after $5,000 in total losses, your remaining risk capital is $19,000, limiting your next trade to $950 maximum risk. Popular instruments require constant recalculation: GBPUSD with 40-pip stops would allow about 3 standard lots initially, while Gold with $20 stops permits roughly 6 standard lots. The danger zone hits quickly despite no daily limits - six consecutive maximum losses (starting at $1,200 and decreasing) could eliminate approximately $6,500 in capital while severely restricting future position sizes. Unlike firms with daily resets, your risk allocation only increases when you're profitable and building distance from the max drawdown. Since this is a single-phase challenge requiring $40,000 profit, you must balance aggressive enough sizing to hit targets against the compounding risk reduction. There's no difference between challenge and funded phases regarding these risk rules - the 5% of remaining risk capital applies throughout.

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