The maximum drawdown is typically represented as a percentage based on your starting balance. This limit is more commonly reached in longer competitions, such as those lasting a week or a month.

For example, if the maximum drawdown is 12% and your starting balance is $100,000, this means that over the course of the entire competition, you can lose a total of $12,000 before being disqualified.

So, let’s say you experience a 5% loss one day (which is $5,000) and a 7% loss the next day (which is $7,000). Together, these losses would total 12% ($12,000), causing you to breach the drawdown limit and be disqualified from the competition.

It's important to carefully monitor your trades to stay within the maximum drawdown limits and avoid disqualification.