EA restrictions on funded accounts: what usually gets flagged

[LondonScalper]

I don't run fully automated strategies on prop accounts, but I do use a couple of small tools: a trade manager that moves stops to break-even and a script that enforces my daily loss limit. Before using them on a funded account, I read through the EA policies of several firms. Rules differ between firms and change over time, so check the current terms of yours. But some patterns come up again and again in what tends to get flagged.

High-frequency trading: strategies placing many orders in a short time, often with very short holding periods. Several firms restrict or prohibit this, and some define it loosely.

Latency arbitrage: anything that exploits delays between price feeds. Almost universally banned.

Tick scalping: EAs that try to profit from tiny moves, holding positions for seconds. Some firms are fine with this, others aren't.

Martingale and grid systems: usually allowed in principle, but they tend to break drawdown rules quickly.

For utility tools like mine, which only manage stops or enforce limits, I've usually found them acceptable, but I still asked support in writing before using them. A written answer is worth having if there's ever a dispute.

[Shadow Trader]

The daily loss script is the one I'd double check, not for policy reasons but for the maths. Most firms I've read calculate the daily limit from the higher of balance or equity at their reset time, and the reset is usually their server midnight, not yours.

If your script measures from your own start of day, or only looks at closed trades, it can think you have room while the firm's rule has already been breached by floating loss. I'd set the script's limit well inside the firm's, say stop at 80% of the allowed daily loss, so slippage on the closing orders doesn't push you over.

One thing missing from your list: running the same EA or trade copier on several accounts at once, especially across different people. Some firms treat identical trades across accounts as group trading or account sharing, even if each account follows the rules on its own.

On tick scalping, it's worth searching the general terms for minimum holding time rules, not only the EA section. A hold time limit of a minute or two can catch a manual scalper too, no EA involved.

[Shadow Trader]

One edge case for the break-even tool specifically: news rules. Some firms restrict any order activity in a window around high-impact releases, and in a few sets of terms a stop modification counts, not just a new entry.

So if price runs on NFP and your manager moves the stop to entry at 13:31, that can be logged as trading inside a two minute window even though the position was opened an hour earlier. "Trading" and "opening a trade" aren't always defined the same way.

The fix I use is a pause in the tool itself. It reads a list of release times, does nothing from two minutes before to two minutes after, then moves the stop once the window closes.

The other thing worth checking is where the stop actually lives. Some trade managers keep a virtual stop inside the EA and only send a close when price gets there, which leaves nothing on the server if the VPS drops.

A few firms require a real stop on every position, and a hidden one may not count. When you asked support in writing, did the question say whether your tool sets server-side stops? It's an easy detail to leave out and it can change the answer.