The Circuit Breaker That Makes FTMO Breach Nearly Impossible

Hard Limits, No Exceptions

S07 enforces two non-negotiable limits. Daily loss cannot exceed 4.5R (FTMO allows 5%, we keep a 0.5R buffer). Total drawdown cannot exceed 9.5R (FTMO allows 10%, same buffer). When either limit is hit, the system shuts down all trading for the remainder of the period. No override. No "just one more trade." No discretionary exceptions.

The buffer matters more than people think. FTMO measures drawdown on equity, which includes floating P&L. A trade that is currently -0.3R open while you are at 4.8R daily loss means you are at 5.1R effective daily loss. The 0.5R buffer absorbs this scenario.

Zero Breaches in 4,505 Trades

Across the full backtest period of 7.5 years and 4,505 trades, the circuit breaker triggered 23 times on daily limits and 0 times on total limits. Every single trigger was the correct decision in hindsight. The worst daily loss that the system actually experienced was 3.8R, well within limits.

The total limit never triggered because the DD-zone risk scaling from S40 reduced position sizes long before drawdown reached critical levels. S07 is the last line of defense. S40 is the first. Together they create a layered protection system where the hard stop is rarely needed because softer interventions happen earlier.

The Insurance You Hope to Never Use

Circuit breakers are like fire extinguishers. You do not evaluate them by how often they activate. You evaluate them by what happens if they are absent. Without S07, Monte Carlo simulations showed a 4.2% annual probability of breaching FTMO limits. With S07 and the DD-zone scaling, that drops to 0.08%. The difference between 4.2% and 0.08% is the difference between a funded trading career and looking for a new prop firm every few months. S07 costs nothing in terms of expected return (the 23 daily shutdowns had minimal opportunity cost) and provides everything in terms of career longevity.