Trading rules

The xato program has two stages:

1. an evaluation stage (the xato evaluation); and
2. a simulated funded stage in which eligible traders may request payouts (the xato account).

All balances in both stages are simulated. Traders do not deposit trading capital with xato.

Xato offers one-step evaluations with the following standard rules:

Evaluation fees are priced in USD. The default funded profit split is 80% to the trader and 20% to xato. An enhanced 90%/10% split may be selected when the evaluation is purchased; see 90% profit split add-on below.

Neither evaluations nor funded xato accounts have a daily gain limit.

An evaluation passes when its live equity reaches or exceeds the profit target while the account remains compliant with all other rules.

When the profit target is reached, xato cancels the evaluation's open and pending orders, closes open positions at the available mark price, and finalizes the evaluation as passed. Trading is disabled while this transition is pending; completion can be delayed if the prices needed to close positions are unavailable.

Once the transition is complete, xato automatically creates a new xato account with the same original account size, margin model, applicable risk rules, and profit-split entitlement. The new account starts with the original starting balance; evaluation profits, positions, and orders are not carried over.

The funded account remains unavailable for trading until the trader has approved and current identity verification (KYC) and has signed the current funded-trader agreement. Passing the evaluation alone does not enable funded trading. These verification and agreement requirements also apply when requesting a payout, alongside the payout requirements below. A funded account or payout may also be subject to compliance and account review.

There is no minimum or maximum time limit for a xato evaluation.

A trader may pass as soon as the profit target is met without reaching either equity limit or violating another program rule.

The xato dashboard displays the account's profit target, maximum daily loss, maximum drawdown, and other applicable limits.

These values are calculated from authoritative account data and updated as account equity changes. Traders are responsible for monitoring the dashboard and leaving sufficient room for trading fees, funding payments, slippage, and unrealized losses.

If account equity reaches or falls below either the maximum-daily-loss floor or the static maximum-drawdown floor, the account is breached. Open and pending orders are canceled, positions are closed at the available mark price, and the account is permanently disabled.

The maximum daily loss and maximum drawdown operate at the same time. Reaching either threshold causes a breach.

The maximum daily loss is 3% for evaluations and funded xato accounts.

The daily equity limit is calculated as follows:

• The loss allowance varies with the account's cash balance, rather than remaining a fixed dollar amount based on its original size.
• It is recalculated every day at 00:30 UTC using the cash balance at that time.
• Cash balance excludes unrealized profit and loss from open positions.

For example, a cash balance of $105,000 at 00:30 UTC produces a daily-loss floor of $101,850 ($105,000 less 3%). That floor applies until the next daily reset, subject to any payout adjustment below.

If live equity, including unrealized profit or loss, reaches or falls below the daily-loss floor at any time, the account is breached.

For funded accounts, a payout debit lowers the current day's daily-loss floor by the amount debited; a reversal raises it by the amount restored. The next daily reset uses the actual cash balance. Payouts do not change the static maximum-drawdown floor.

The maximum drawdown is static and equal to 6% of the original account size.

For example, a $100,000 account has a permanent maximum-drawdown floor of $94,000. The floor does not trail profits and does not move up or down.

If live equity, including unrealized profit or loss, reaches or falls below the maximum-drawdown floor at any time, the account is breached.

The same static maximum-drawdown floor continues to apply to the corresponding xato account. A payout does not move that floor.

Xato charges a trading fee of 0.04% of notional value per filled side for both maker and taker fills.

The fee is calculated separately on the actual notional value of each opening and closing fill. If those notional values are equal, the combined fee is 0.08% of that value before funding payments. Closing fees also apply when xato automatically closes a position.

Perpetual positions may also pay or receive variable funding. Funding rates are taken from the applicable market-data and liquidity provider and are applied at the instrument's settlement interval. For the currently enabled Hyperliquid markets, funding is evaluated hourly. Funding is not a fixed daily swap charge and may be positive or negative.

Fees and funding affect account balance, equity, and the available room under the program's risk limits.

Xato uses live reference prices to simulate execution. Spreads, price changes, and quote availability affect execution; the displayed external order book is not a guarantee of a fill or a simulation of queue priority and available depth.

For evaluations and funded xato accounts, leverage is set automatically to the lower of the provider's maximum for the instrument and xato's 25x limit. For example, an instrument with a provider maximum of 10x or 15x uses that leverage; an instrument with a provider maximum above 25x uses 25x. Leverage cannot be changed by the trader.

A fill uses the instrument maximum in effect at that fill, capped at 25x. Open exposure keeps that assigned leverage; it is not recalculated if the provider later changes the instrument maximum. New orders and fills use the current maximum, capped at 25x. Pending orders that add exposure are re-checked when that maximum changes.

If current instrument leverage or market data is missing or not current, xato rejects orders that add exposure. Supported reduce-only closes remain available.

A breach occurs when any of the following happens:

• live equity reaches or falls below the maximum-daily-loss floor;
• live equity reaches or falls below the static maximum-drawdown floor;
• the trader uses a prohibited trading practice; or
• the trader violates the applicable agreement, terms, or program rules.

When an account is breached, xato cancels open and pending orders, closes open positions at the available mark price, and permanently disables the account. For a funded account, all profit that has not been paid out is lost, subject to the rules for pending payouts under Payouts from a xato account.

Both equity limits apply continuously and simultaneously.

Risk calculations include unrealized profit and loss from open positions. Trading fees, funding payments, and execution slippage can therefore cause an account to reach a limit even when the trader's price-only calculation appears to leave a small buffer.

The thresholds are inclusive: reaching a limit is sufficient to cause a breach.

Traders may use public research, analysis and educational material and may change their trading strategy. Account sharing, third-party account management, automated copying of another trader's orders, and coordinated trading intended to exploit the evaluation or payout rules are prohibited.

Trading intended to exploit the evaluation, platform, price feed, liquidity source, payout structure, or another account is prohibited. Prohibited conduct includes, without limitation:

• exploiting a platform, pricing, latency, data, or execution error;
• using material non-public or inside information;
• front-running orders placed elsewhere;
• manipulating or attempting to manipulate a market, venue, liquidity provider, or xato account;
• trading in a way that creates regulatory or counterparty risk for xato or its providers;
• using a purchased, off-the-shelf, or third-party strategy marketed primarily to pass prop evaluations;
• arbitraging one xato account against another xato account or an account at another firm;
• using execution patterns that cannot reasonably be replicated in live markets or that create excessive unrealized-P&L risk;
• automatically copying another trader's orders or coordinating trading intended to exploit the evaluation or payout rules;
• sharing an account, credentials, device access, or trading control with another person, or having a third party manage the account; and
• coordinating trades across traders, identities, households, devices, networks, or firms to manufacture a guaranteed or near-guaranteed result.

Xato may review trading, device, network, timing, order, and account data when investigating suspected prohibited trading.

Stock, commodity, and crypto positions may be held over the weekend. There is no mandatory weekend close.

Stocks and commodities on xato use Hyperliquid HIP-3 perpetual markets and trade 24/7, including weekends, alongside crypto. Trading continues outside the traditional trading hours of the underlying assets.

Funding, spreads, slippage, and reduced liquidity may continue to affect positions held across weekends or illiquid periods.

The xato platform supports more than one evaluation per trader, and every evaluation is assessed independently.

Xato does not currently impose a combined active account-size cap.

Cross-account hedging, arbitrage, automated copying of another trader's orders, and coordinated trading intended to exploit the evaluation or payout rules remain prohibited.

Each instrument has a maximum position value in USD, independent of its leverage. Available margin, existing positions and orders, opening fees, and account loss limits also restrict the size of a new order.

Account equity is shared across positions. Buying power includes unrealized profit and loss across all open positions. Unrealized profit cannot be withdrawn.

An order that adds exposure may be refused if projected equity after that fill and its opening fee would reach or fall below either account loss floor, even when margin is available. This check does not include a predicted close of this order or of other positions, and it does not prevent a later breach from marks, funding, closing fees, or slippage.

The terminal requires at least $12 of order value for new orders and partial closes. A reduce-only order closing the entire remaining position can close a smaller residual position. For a new-order submission, the requested quantity cannot exceed 1,000,000 units of the instrument and must follow its permitted size precision. This is a submission limit, not a $1,000,000 position-value limit or an aggregate position-size cap. An account may have no more than 512 open and pending orders in total, including pending attached orders.

Resting orders that add exposure reserve opening margin and a fee buffer equal to twice the current taker fee on the remaining order value. That buffer is a buying-power hold, not an extra charge; the filled fee remains 0.04% of the fill's notional. Immediate fills do not occupy that buffer. Reduce-only orders do not reserve opening margin or opening fees. A pending reduce-only order does not provide advance buying-power credit for its intended close.

Displayed buying power is an estimate. Xato may reduce an order to accommodate fees or reject it because of account limits, an instrument position cap, or unavailable or stale market data, including instrument leverage. A rejected order or zero buying power does not by itself breach the account. Higher leverage does not increase either account loss allowance.

Xato maintains a net position per instrument within each account. An opposing fill on the same instrument reduces, closes, or reverses the existing position; separate simultaneous long and short positions in the same instrument are not supported within one account.

Cross-account hedging is prohibited. This includes opening opposing positions in the same or closely correlated instruments across multiple xato accounts, multiple traders, or xato and third-party accounts when the timing, price, size, exposure, or overall pattern indicates a coordinated economic hedge.

Traders may use public research, analysis and educational material and may change their trading strategy. Account sharing, third-party account management, automated copying of another trader's orders, and coordinated trading intended to exploit the evaluation or payout rules are prohibited. Any strategy designed to secure a guaranteed or near-guaranteed result across accounts is also prohibited.

A finding of deliberate prohibited hedging or copy trading may result in account termination, loss of unpaid performance amounts, and disqualification from the program. Xato may use a warning for an inadvertent, isolated event at its discretion.

Payouts are not available during a xato evaluation. The evaluation exists only to assess trading performance under simulated conditions.

Payout eligibility begins only on a xato account and remains subject to the funded-account payout requirements below.

Eligible funded traders may request payouts on demand, including weekends. There is no scheduled payout cycle, first-payout waiting period, minimum trading-day count, minimum winning-day count, profit-consistency rule, request cooldown, or lifetime payout cap.

Payouts are made through Fireblocks in USDT as an ERC-20 token on Ethereum. The minimum net payout to the trader is 50 USDT. Xato pays the Ethereum network fee separately.

Only realized profit above the funded account's starting balance is available for payout. Unrealized profit cannot be withdrawn.

Breaches and unpaid profit. Profit can only be paid out from a funded account that has not breached. If your funded account breaches, all profit in that account that has not been paid out is lost, including realized and unrealized profit. Payouts that were completed before the breach are not affected. You can request a payout of eligible realized profit at any time before a breach, including on weekends.

To submit a payout request, the trader must satisfy all current eligibility checks, including:

• ownership of an unbreached xato account with funded status;
• approved and current identity verification;
• a signed current funded-trader agreement;
• no open positions;
• no active executable orders;
• all due funding payments having posted;
• no active compliance, sanctions, fraud, or account-review hold;
• a valid Ethereum destination address; and
• enough realized profit to cover the requested net payout and xato's share.

Every payout is subject to recorded administrator approval before submission to Fireblocks. Fireblocks authorization and blockchain processing remain separate steps. Submission of a request does not guarantee immediate review, provider authorization, blockchain confirmation, or wallet receipt.

Breaches after you request a payout. Once you submit a valid payout request, the requested amount and xato's share are set aside. They are not affected if your funded account later breaches. The payout still goes through xato's normal approval and compliance review, but a breach after submission does not cancel it. A payout is only stopped or reversed if it fails compliance review, if the transfer fails for technical reasons (for example, the blockchain transaction is rejected), or if xato is legally prohibited from completing it. If a transfer fails for technical reasons, xato will retry it or restore the amount to you, and will not treat the failure as a forfeiture.

Errors on xato's side. If a breach was caused by an error attributable to xato or its providers, such as an incorrect price, a platform malfunction or a rule applied incorrectly, the profit is not lost. Xato will restore your account and any affected payout request to where they would have been without the error. Where that isn't practicable, xato will pay you the profit share you would reasonably have received.

The trader supplies or selects an Ethereum address for each request. Xato may save user-owned addresses as an entry convenience, but the selected address is validated and locked when the request is submitted and cannot be changed for that request. A saved address is not a Fireblocks External Wallet or an approval decision. Assets sent to an incorrect address or network may be permanently lost. USDT is not a bank deposit and does not have FDIC or SIPC protection.

Evaluation purchases are processed by Checkout.com. Evaluation prices are denominated in USD, and the payment methods available to a trader are those displayed by Checkout.com at the time of purchase.

USDT is the funded payout asset; it is not the unit used to state evaluation prices.

Xato does not require traders to deposit trading capital.

Evaluation and xato account balances consist entirely of simulated capital. A payout is a contractual performance payment from eligible realized simulated profit; it is not a withdrawal of customer funds held in a trading account.

Identity verification is not required to trade a xato evaluation. After passing, approved and current identity verification (KYC) through Sumsub and a signed current funded-trader agreement are required before the funded xato account becomes available for trading.

Approved and current identity verification and a signed current funded-trader agreement remain mandatory when submitting a funded payout request. Xato may require additional compliance review or refreshed verification where appropriate.

You must re-verify your identity two years after your last approved verification, or earlier if your identification document expires. Xato gives 30 days’ notice before restricting funded trading and payouts for scheduled re-verification.

If re-verification has not been approved by the deadline:

• funded accounts become reduce-only: you may close or reduce existing positions and manage protective orders, but may not open new positions or increase exposure;
• payouts are paused until re-verification is approved; and
• this restriction does not itself breach your account or forfeit accrued profit share. Eligible profit share remains payable once re-verification is approved, subject to the other payout requirements.

The program rules and risk limits continue to apply while an account is reduce-only.

Sumsub conducts xato's identity-verification checks. The required documents and verification steps are presented during the Sumsub process and may vary where additional evidence is required.

VPN use is permitted only when it is not used to hide or misrepresent the trader's location, identity, device, account control, or legal eligibility.

Using a VPN, proxy, remote desktop, or similar service to evade a jurisdiction restriction, conceal account sharing, or interfere with compliance checks is prohibited.

Trading during news events is permitted, subject to the availability of reliable market data, pricing, and liquidity.

Spreads, slippage, volatility, funding, market pauses, and provider limits may change rapidly around news. The normal equity limits and prohibited-trading rules continue to apply.

The current restricted-jurisdiction list and eligibility requirements are set out in Who May Use xato in the Terms of Use. Review that section before purchasing an evaluation.

Traders must be at least 18 years old and have the legal capacity to accept xato's terms in their jurisdiction.

Before checkout, the trader must accept the Terms of Use and attest that they are at least 18 years old. Xato may require identity or age evidence as part of a compliance review.

Evaluations purchased under the same xato profile appear in the account selector. Traders can switch between their evaluations and xato accounts from the application.

Each account has separate balances, positions, orders, limits, and rule status.

Xato supports reducing part of an open position. A trader may set a reduce-only take-profit for a portion of the position or manually close a chosen amount.

A reduce-only order is limited to the position available to close. Partial closes must meet the terminal's minimum order value; a full close may clear a smaller residual position. Closing part of a position is different from receiving a partial fill because of external order-book depth.

Stop-loss and take-profit orders may be used only to reduce or close existing exposure. They must be reduce-only. Stop-market and stop-limit orders that would open or increase a position are not supported.

Stop-loss and take-profit orders activate when the instrument's mark price reaches the trigger condition. A market trigger then needs a current executable bid or ask within the platform's 8% adverse-price limit relative to the trigger price. If it cannot execute within that limit or no executable quote is available, the order can be rejected or canceled without a fill. A trigger price does not guarantee a closing price or a maximum loss.

A stop-limit or take-profit-limit order becomes a regular limit order when triggered. It can remain open if its limit price cannot execute. Traders remain responsible for monitoring positions and account equity limits when a protection order does not execute.

Evaluations and funded xato accounts have no individual position liquidation price. A position's loss can exceed its margin allocation while the account remains within its loss limits.

Margin allocated to open exposure is set from the fill price and assigned leverage. Mark-price moves change unrealized profit and loss and buying power; they do not rewrite that allocation.

Insufficient available margin prevents additional exposure. An order that adds exposure is also refused if projected equity after that fill and its opening fee would reach or fall below either account loss floor. Neither condition closes existing positions by itself.

Reduce-only closes and protective stops remain subject to their normal execution conditions. A reduce-only close is still accepted if the account is already near or through a floor; if the close and its fee then print equity through a floor, the account is breached.

If live account equity reaches or falls below either account loss floor, the account is breached: open and pending orders are canceled, positions are closed at the available mark price with closing fees, and the account is permanently disabled.

Trading takes place with simulated capital. The platform uses live reference prices to price simulated fills. Market orders use the available bid or ask when current, with a current midpoint or mark price as a fallback. Limit orders require an executable bid or ask at the limit price or better. Account pass and breach transitions close positions at the available mark price.

The trading engine records orders, positions, profit and loss, fees, funding, and account-rule outcomes internally. It does not route or copy trader orders to a live venue. Xato may apply risk and execution controls intended to prevent latency arbitrage, platform abuse, or execution that cannot reasonably be replicated in live markets.

Because trading is simulated, no external venue acts as the trader's live counterparty or holds trading capital for the trader.

For currently enabled markets, xato uses Hyperliquid as the reference source for market prices, instrument information, funding data, and best-bid-and-offer data. A trader's order is not submitted to Hyperliquid as a live-funded customer order.

Xato may add, remove, or change its reference markets, data sources, or execution model. Prices on an external chart or exchange may not match the xato terminal exactly; the xato terminal and xato's authoritative account records govern program calculations.

Trading is available through xato's custom web trading terminal.

Stocks, commodities, and crypto are available 24 hours a day, seven days a week, including weekends. Stock and commodity instruments use Hyperliquid HIP-3 perpetual markets, with trading continuing outside the traditional trading hours of the underlying assets.

Trading may be interrupted by maintenance, provider outages, market halts, or unplanned service interruptions. Orders remain subject to the normal market-data, pricing, and execution requirements. Liquidity and pricing conditions may vary when an underlying reference market is closed.

A limit order remains open until an executable quote meets its limit price, it is canceled, or an account or order control ends it. Touching the price on a chart does not guarantee execution.

The simulated engine does not currently reproduce external order-book queue priority or consume displayed depth to produce liquidity-based partial fills. Order size can still be adjusted for account constraints or the position available to close.

Ordinary limit orders currently behave as GTC (Good Til Canceled). IOC (Immediate Or Cancel) and ALO (Add Liquidity Only / post-only) execution are not currently supported for ordinary simulated limit orders.

The standard funded profit split is 80% to the trader and 20% to xato.

Selecting the enhanced add-on at the initial evaluation purchase changes the split to 90% to the trader and 10% to xato. The add-on increases the evaluation price by 20%:

The selected split is attached to the account, copied to the funded xato account, and fixed for that account's lifetime. It cannot be added retroactively.