Maximum adverse excursion (MAE)
Maximum adverse excursion is the worst unrealised loss a trade reaches before it closes, whether it ends profitable or not.
How it works
Measured per trade as the distance from entry to the least favourable price touched during the holding period. Aggregated across a backtest, the MAE distribution shows how much heat the strategy takes on trades that eventually win — information the win rate and profit factor hide entirely. A strategy with a 70% win rate whose winners routinely sit $400 underwater has a different risk profile from one whose winners never go $100 against.
Why it matters on a funded account
On an intraday trailing account MAE matters more than the stop distance, because unrealised loss is what the floor measures. Comparing the MAE distribution to the account's buffer is the honest test of whether a strategy fits a given firm.
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Part of the Puravida Edge prop trading glossary. Firm-specific figures verified September 2026; rules change frequently — confirm on the firm's site.