How Prop Firms Work
Understand the complete process from funding to profit sharing
What is a Prop Firm?
A Proprietary Trading Firm (Prop Firm) provides capital to traders and shares the trading profits. It offers the opportunity to trade with significant capital without risking your own funds.
The Process
Sign Up for a Challenge
Select your desired account size and register for the evaluation program. A registration fee is typically required.
Evaluation Stages
Complete 1-3 evaluation stages. You must achieve profit targets and follow risk management rules in each stage.
Get Funded
Upon passing the evaluation, you receive a funded account and can start trading with real capital.
Profit Sharing
You receive 80-95% of trading profits. Payment cycles are daily, bi-weekly, or monthly.
Evaluation Criteria
Profit Target
Percentage of profit to achieve in each stage (typically 5-10%).
Max Drawdown
Maximum allowed loss percentage (typically 5-10%). Exceeding this results in failure.
Minimum Trading Days
Minimum number of trading days required (typically 3-5 days).
Time Limit
Time limit to complete each stage (some firms offer unlimited time).
How Profit Sharing Works
Many firms increase your profit share based on your trading performance.
Choosing Account Size
Prop firms typically offer multiple account sizes. Beginners should start with smaller accounts and progress to larger ones as they gain experience.
Small
For Beginners
Medium
For Intermediate
Large
For Advanced
Ready to Get Started?
Compare firms and find the one that matches your trading style and goals.