Skip to main content
All CollectionsChallenge Rules
Challenge Rules - [General]
Challenge Rules - [General]

Understanding the trading rules for each challenge type

Updated over 2 months ago

Nostro Trading Guidelines:

Welcome to Nostro’s basic trading policy guideline. This document provides a general overview of key rules and restrictions designed to promote responsible trading, effective risk management, and fair play on our platform.

1. Risk Management

1.1 Maximum Risk per Trade

  • Rule: Traders must limit risk to a maximum of 2% of their total account balance per symbol, this includes multiple trades of the same symbol.
    ​

  • Purpose: This rule helps in preserving capital by minimizing the impact of individual losses.
    ​

  • Risk Calculation: Consider entry point, stop-loss setting, and trade size.
    ​

    • Example: For a $10,000 account, the maximum allowable risk per trade is $200. If a trade has a stop-loss 50 pips away with each pip worth $1, the total risk for this trade is $50, which is within the allowed limit.
      ​

  • Compliance: If a trade is placed that exceeds the maximum risk limit, the trader will have their trades reviewed during the funded verification review. If any trades exceed the 2% per trade loss limit, the challenge will result in a breach. This policy applies to all challenge and funded phases.
    ​

  • Penalties for Non-Compliance: If a trade is placed that exceeds the maximum risk limit, the trader will have their trades reviewed during the funded verification review. If any trades exceed the 2% this will result in an account breach and the challenge will be terminated. These measures ensure that all traders adhere to risk management practices that protect both their capital and the integrity

1.2 Consistency Score

  • Purpose: Measures the distribution of profits over time to assess trading reliability and sustainability.
    ​

  • Calculation:
    ​

    • Formula: (1−(HighestProfitorLossDay/AbsoluteSumofallTradingDays))×100
      ​

    • Steps:

      1. Identify the highest profit or loss on a single trading day.

      2. Calculate the absolute sum of all trading days (sum of the absolute values of daily profits and losses).

      3. Apply the formula to compute the Consistency Score.
        ​

    • Example: If the highest daily gain is $400 and the total absolute profit is $1,000, the Consistency Score = (1− (400 / 1000)) × 100% = 60%.
      ​

  • Interpretation:
    ​

    • 0%: All profits from a single day, indicating high risk and speculation.

    • 50%: 50% of profits from the most profitable day, showing some distribution.

    • 80%: 20% of total profits from the most profitable day, indicating better consistency.
      ​

  • Impact on Profit Sharing:
    ​

    • 0-50%: 40% profit share

    • 50-70%: 60% profit share

    • 70-90%: 80% profit share

    • 90-100%: 100% profit share
      ​

  • Application: Scores affect profit-sharing only during the funded phase, not during evaluations.

1.3 Minimum Trading Days

  • Requirement: Engage in active trading for at least 5 days during each phase of the trading program (Evaluation and Funded stages).
    ​

  • Purpose: Ensures consistent trading performance and accurate assessment of trading strategies.
    ​

  • Consequences:
    ​

    • Incompletion of Phase: Failure to meet the minimum trading days may result in the need to repeat the phase.
      ​

    • Impact on Profit Sharing: Non-compliance can affect eligibility for profit sharing and other account benefits.

1.4 Maximum Balance Allocation

  • Limit: Maximum balance allocation per trader is set at $100,000 across all active accounts.
    ​

  • Purpose: Prevents disproportionate risk exposure and ensures a balanced trading environment.
    ​

  • Impact: Traders exceeding this limit will have additional funded account requests declined.

2. Restricted Strategies

2.1 Prohibited Strategies

  • High-Frequency Trading: Includes practices like exploiting MetaTrader 5 inefficiencies, high-frequency trading, tick scalping, toxic order flow, and arbitrage.
    ​

  • Hedging: All forms are prohibited, including inverse correlation, cross-account, and hedging arbitrage.
    ​

  • Expert Advisors (EAs): Allowed if compliant with trading rules.
    ​

    • Compliance Verification: EAs must align with Nostro's trading guidelines. Proof may be requested for verification.
      ​

    • Restricted EAs: EAs engaging in prohibited practices will result in account termination.
      ​

  • Enforcement:
    ​

    • Account Review: Accounts may be temporarily suspended for review.
      ​

    • Termination: Violation of restricted strategies can lead to account termination and forfeiture of profits.

2.2 One-Sided Bets

  • Definition:
    ​

    • Characteristics: Large, speculative trades with excessive leverage, lacking a comprehensive strategy.
      ​

    • Risks: High risk of significant losses due to lack of risk management.
      ​

    Policy:
    ​

    • Prohibition: One-sided bets are strictly forbidden to maintain a stable trading environment.
      ​

    • Enforcement:
      ​

      • Account Review: Immediate review of trading activities.

      • Suspension: Possible temporary or permanent suspension of trading privileges.

      • Profit Forfeiture: Profits from one-sided bets may be forfeited.

2.3 News Trading

  • During Evaluation:
    ​

    • Freedom: No specific restrictions during evaluation stages.
      ​

    Post-Evaluation:
    ​

    • Restrictions: No new trades or modifications within a 2-minute window before and after high-impact news events.
      ​

      • Trade Execution: Includes all forms of opening and closing positions, as well as modifying pending orders.

      • Allowed Actions:

        • Holding Existing Trades: Permitted if established more than 2 minutes before the news.

        • Monitoring: Continue to monitor trades during the restricted period.

        • Post-Event Adjustments: Resume trading after the restriction window ends.
          ​

    Restricted News Events:
    ​

    • Forex: Federal Funds Rate, Non-Farm Payroll, CPI, etc.
      ​

    • Energies: Crude Oil Inventories
      ​

    Consequences:
    ​

    • Violations: May result in profit invalidation, suspension, or termination of trading privileges.
      ​

    Additional Clarifications:
    ​

    • News trading restrictions apply only during the funded phase. Evaluation accounts are exempt from these restrictions.
      ​

Visit our Advanced Nostro Trading Guidelines article for a more detailed outline on Nostro's trading policies: https://help.nostro.co/en/articles/9351664-nostro-s-trading-guidelines

Did this answer your question?