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Best Prop Firms

 
Best Prop Firms - Unlocking Funded Trading

Prop or funded account trading is more than a trend; it's a rapidly growing sector with exciting prospects for traders. Our comprehensive guide is here to help you navigate and make informed decisions for your prop trading ventures. The online trading world is flooded with Prop firms seeking traders, making it challenging for newcomers. A Prop firm provides traders with capital, offering an advantage of larger amounts for higher returns and improved profit margins.

However, many traders overlook the importance of thorough research, leading to the swift depletion of accounts. With numerous enticing offers, making an informed decision becomes perplexing, emphasizing the need for comprehensive research.

Success in 2024 lies in selecting the right Prop firm for forex trading. This has never been more crucial as the prop trading niche is currently in much turmoil, especially in the USA, following regulatory pressures and punitive measures by watchdogs, as well as surprise decisions by strong players such as FTMO banning US clients for the time being. Some have rushed to call it the end of prop trading, but our team’s view begs to differ.

Currently, there remain multiple options for prospective prop traders and the revived interest of pertinent authorities may not necessarily bring the demise of the sector, but may instead encourage prop firms to up their game and become more transparent and reliable casting away any shadows. If you are an aspiring prop trader, you must remember that before diving in, you must learn the fundamental factors for an informed choice. This guide aims to help all traders make the right decision armed with the necessary knowledge.

Before exploring prop trading firms, let's first discuss whether funded trading is suitable for everyone and why.

Who Should Dive into Funded Trading?

Funded trading, offering a chance for skilled traders to access significant capital and share profits, is a smart move for those aiming for growth. This trading style, also known as proprietary trading, has gained popularity for its clear advantages.

If you're an experienced and consistently profitable trader with a solid understanding of markets and risk management, funded trading reduces financial exposure while boosting income potential. It's especially helpful for traders with limited funds looking to expand their activities.

Funded trading suits those with sharp risk management skills, discipline, and emotional resilience. If you're comfortable following specific rules and guidelines set by funding firms, this opportunity could be the right fit.

While requirements may differ, our guide offers a handpicked selection of top funded trading firms, empowering you to make an informed decision that matches your strengths and preferences. First, let's explore the unique aspects of prop trading firms.

What Sets Prop Trading Firms Apart?

Understanding prop trading firms is key before taking the plunge. A Proprietary Trading Firm, or Prop Firm, is a financial institution using its capital for self-benefit through trading. Some even allocate funds to retail traders, letting them trade on the company's behalf. Traders access the firm's capital, participating in various markets. Prop Firms, whether online or traditional, often share profits, favoring traders. This approach, especially for retail investors, has gained popularity for its attractive opportunities.

For those unable to invest $200,000, Prop Firms break the financial barrier, offering global market access. This presents a more accessible path to handling substantial capital and pursuing trading careers without enduring Wall Street internships. However, this seemingly straightforward route comes with challenges. But first, let's discuss the crucial aspects of regulation and legitimacy.

Are Prop Trading Firms Trustworthy?

Proprietary trading firms, or prop firms, are legit businesses offering trading accounts to skilled traders after thorough evaluations. They set guidelines like profit targets and time constraints to collaborate with successful traders and minimize losses. Traders pay fees for evaluations and live trading, contributing to the firm's profits, even if a trader doesn't perform well.

While most prop firms operate legitimately, some bad actors exist due to limited oversight. Choosing established firms is generally safer, but recent regulatory decisions raise concerns. Forex and futures prop firms provide traders with substantial accounts based on demonstrated profitability.

Why Aren't Prop Firms Regulated?

Prop firms aren't heavily regulated because they trade with their own money, avoiding many rules related to managing others' funds. Unlike Forex brokers, they don't handle client money, offering flexibility but limiting trader protections. Some prop firms use virtual capital, avoiding financial transactions.

Prop firms often present themselves as educators, not service providers, which is legally acceptable. Future regulations may change this. The lack of strict rules reduces funding costs but requires caution in choosing trustworthy prop firms to avoid fraud.

 

Choosing Legitimate Prop Firms

How to choose a Legitimate Prop Firms

In the prop trading world, scams may pose as real firms, so it's crucial to distinguish between reputable and fraudulent ones. Consider:

  • Reputation: Stick to reputable prop firms. Check their reputation on various platforms, filtering out baseless criticisms.
  • Support: Legitimate firms have strong support. Ensure they're available 24/7, accessible, and respond promptly.

In summary, prop firms should follow safety rules. While not all are bad, distinguishing between reputable and untrustworthy ones is vital. Checking reputation and support helps ensure legitimacy.

Identifying Warning Signs in a Proprietary Trading Firm

Proprietary trading firms provide a pathway for traders to enhance skills and potentially gain financial rewards. However, not all firms are reliable, and it's vital to recognize red flags when evaluating a prospective prop firm's credibility.

Here are key indicators to be cautious about when considering a prop trading firm:

  • Trustpilot Absence: Trustworthy prop trading firms usually have a presence on review platforms like Trustpilot. Check if the Trustpilot link provided is genuine and operational. A surge in negative reviews is a clear red flag.
  • Website Quality: Legitimate prop trading firms maintain professional and well-crafted websites. Spelling errors or an unprofessional appearance may indicate a less trustworthy firm.
  • Online Visibility: Reputable prop trading firms have a strong online presence, including active social media accounts. If a firm is absent from platforms like Facebook, Instagram, or YouTube, it may raise credibility concerns.
  • Customer Service Responsiveness: A history of unresponsive customer service is worrisome. A reliable firm should be readily available to assist clients and provide timely support.
  • Too Good to Be True Claims: Proprietary trading involves challenges. If a firm's promises seem too easy or too good to be true, like significantly higher profit targets, minimal drawdown rules, or extraordinarily low funding costs, it may lack credibility.

Before engaging with a prop trading firm, thorough due diligence is crucial. By being vigilant for these warning signs, you can avoid untrustworthy players in the prop trading industry.

Choosing the Right Funded Trading Account Provider

Selecting the best-funded trading account is a personalized process that depends on aligning options with your preferences and needs as a trader. To guide this crucial decision, consider these factors when evaluating potential funded trading account providers:

  • Funding Amount: Optimal accounts come with substantial capital, enabling traders to take larger positions and potentially increase profits.
  • Profit Sharing: Top providers offer competitive profit-sharing terms, ensuring traders keep a significant portion of their profits.
  • Risk Management: Esteemed providers emphasize risk management, implementing limits, size restrictions, and robust control measures to protect both trader and firm capital.
  • Funding Terms and Conditions: Transparency is crucial. Look for well-defined terms outlining the funding process, evaluation criteria, performance targets, and any associated fees.
  • Training and Support: Leading providers offer valuable training, educational resources, and mentorship to help traders refine their skills. Ongoing support is vital, especially for those improving their trading abilities.
  • Platform and Technology: Top-tier providers offer reliable, advanced, and user-friendly trading platforms with essential features. Fast execution, real-time data access, and a user-friendly interface are key components for trading success.
  • Track Record and Reputation: Research the track record and reputation of potential providers. Look for established companies with positive reviews, a track record supported by successful traders, and a transparent evaluation process.

Take ample time to assess and compare different funded trading account providers. Your goal is to find the provider that aligns with your trading objectives, risk tolerance, and preferences. Use the factors mentioned as your guide, and reach out to providers directly for comprehensive information. Make an informed decision regarding your partnership.

Choosing the Right Proprietary Trading Firm: What to Look For

When selecting the ideal prop trading firm, it's crucial to carefully consider various factors that can shape a successful and tailored partnership for your trading journey. Here's a guide on what to focus on:

  • Trading Restrictions: Evaluate the trading restrictions imposed by each firm. Choose one whose constraints align with your strategy, creating an environment conducive to success.
  • Product Range and Instruments: Prop firms vary in the financial instruments they offer. Research diligently to find a firm that provides assets aligning with your specific trading interests and skills.
  • Evaluation Criteria: Scrutinize the evaluation process, including profit splits, funding options, tradable assets, duration, and promotion criteria. Meticulously assess these components to find a prop firm that aligns with your trading style and objectives.

In essence, selecting the optimal prop trading firm requires careful consideration of several factors. Anchoring your decision to your trading goals and specific needs, along with diligent research, can lead you to a firm perfectly suited to your unique trading strategy.

Additional Tips for Prop Firm Selection

  • Growth Program: Ensure the firm's growth program aligns with your objectives, offering opportunities for account growth.
  • Costs and Payment Models: Assess participation costs, restrictions, and payment models. Choose the one that aligns best with your financial situation and growth objectives.
  • Payout Options: Review the firm's payout options and withdrawal terms to understand their impact on your growth.
  • Resources: Evaluate the resources provided, including dashboards, live trading rooms, and educational materials. Ensure they complement your trading strategy.
  • Customer Support: Consider the level of customer support provided. Responsive support can be invaluable for guidance and assistance.

Being aware of your options and finding a prop trading firm that aligns with your needs is crucial for success in the world of proprietary trading in 2024 and beyond.

Discovering the Best Prop Firms

Our expert team has compiled a list of their favorite funded trading accounts. This carefully crafted list considers the criteria we've discussed earlier, along with other important aspects. Our goal is to give traders like you a useful resource for making an informed and confident decision when choosing your funded trading account provider. Without delay, here are our top prop firms picks

The Best Prop Trading Firms in 2024

Rating breakdown

Challenge Assessment
90%
4.5/5
Support
100%
5.0/5
Trading Fees
100%
5.0/5
Payout Scheme
90%
4.5/5

Things we liked:

 Exclusive Discount Code (20% Off Exclusive Offer)
 Minimal rules & unlimited time for completion
 Two-part assessment leading to $200,000 in funding
 Scaling plan & fast-track funding opt

Things we didn't like:

 A Relatively New player in the funded account offering

4.1 / 5

Rating breakdown

Challenge Assessment
90%
4.5/5
Support
70%
3.5/5
Trading Fees
70%
3.5/5
Payout Scheme
100%
5.0/5

Things we liked:

 FTMO charges a one-time fee only
 FTMO has generous conditions for its traders

Things we didn't like:

 Complaints about the platform freezing
 Complaints about lack of customer support

3.9 / 5

Rating breakdown

Challenge Assessment
70%
3.5/5
Support
70%
3.5/5
Trading Fees
90%
4.5/5
Payout Scheme
80%
4.0/5

Things we liked:

 Let you trade with leverage of up to 1:30

Things we didn't like:

 5%ers Challenge fee is on the higher end of the spectrum
 There are other holes in the 5%er offer

View All Prop Firms

Decoding Funded Trading

Funded trading accounts operate on the principle of a proprietary trading account managed by an external trader, benefiting both the trader and the prop firm providing the financing. This setup offers several advantages, making it an attractive option for traders seeking to enhance their trading ventures.

A key advantage is the risk reduction for traders, as the capital infusion provides a protective layer in navigating financial markets. Prop traders, with substantial capital backing, gain access to a diverse range of tradable assets, empowering them to execute strategies more effectively.

It's essential to note that access to funded trading programs is a privilege reserved for those demonstrating trading expertise. Candidates undergo a thorough evaluation process before gaining access to funding accounts, where they can retain a significant portion of their profits, often up to 90%, depending on program terms.

Engaging in funded trading proves lucrative for both traders and prop firms. Traders benefit from advanced tools and market data, typically beyond individual traders' reach. Proprietary trading firms enhance profitability by actively participating in markets and earning fees and commissions on traders' transactions, creating a dual revenue stream.

 

Becoming a Funded Trader: Marching along with Proprietary Trading Firms

As a funded trader with a prop firm, you operate within set trading parameters while maintaining the flexibility to use various strategies, such as day trading. Though these parameters differ among firms, the advantages of trading with a prop firm remain consistent compared to solo ventures. Online prop firms operate 24/7, allowing traders to choose their trading hours and strategies, creating a balance between personal and professional life without rigid schedules. To become a funded trader, you must first face a challenging evaluation, assessing your ability to navigate financial markets. Completing this process opens the gates to the firm's capital, granting you freedom from external constraints. However, achieving the title of funded trader is no easy feat. Prop firms demand evidence of your profitability, and you must conquer their unique evaluation challenges.

The evaluation typically unfolds in two stages, requiring a 10% profit in 30 days and an 8% return on investment in the following 60 days. Constraints, like a 5% daily loss limit and 12% overall loss limit, add more complexity to the endeavor. Successful completion allows you to become a funded or proprietary trader.

Prop firm challenges are intentionally formidable, testing both trading skills and psychological fortitude. Each firm has unique rules, with violations leading to disqualification. Selecting a reputable firm with fair evaluation terms is crucial due to the lack of proper and comprehensive regulatory oversight in the prop trading realm.

Completing the evaluation is just the beginning; sustaining profitability poses ongoing challenges, requiring discipline to navigate maximum drawdown limits even with a substantial account.

Succeeding as a Proprietary Trader

For aspiring traders considering proprietary trading, the key question revolves around achieving profitability. While it's theoretically possible to generate income with a prop firm, the reality is that most aspirants won't succeed. Proprietary firms exclusively back exceptional performers, with less than 5% qualifying for profit-sharing after evaluations. Critics argue the model is flawed, but supporters contend it aligns with success rates for traders using their own funds.

For experienced traders with effective strategies, joining a prop firm may not be the most lucrative long-term choice, as independent trading could yield higher returns. Some opt for prop firms due to initial capital constraints, which these firms can address.

Prop firms set stringent requisites, capping permissible risk, specifying profit targets, and imposing time constraints. This makes short-term tactics more prevalent than long-term approaches, which may not suit every trader. Before considering prop firm involvement, traders must assess these requirements to ensure alignment with their strategies. Prop trading isn't a universal solution, but it can be promising for traders with proven strategies yielding consistent positive results.

Prop Trading with caution

Be a successful proprietary trader

Boost your chances of success and minimize risk by engaging with multiple reputable prop firms while keeping your primary trading account funded with your own capital. Diversifying risk across firms acts as a safeguard, reducing vulnerability if one encounters financial or regulatory issues. Reinvesting profits into your main account, rather than leaving them in funded prop accounts, is another wise move. Software like MT4 Copier simplifies replicating trades across various accounts, making the management of multiple funded accounts more efficient.

While enrolling with multiple prop firms is a smart strategy, do so sensibly and keep meticulous records of each firm's requisites and boundaries. Repeat this process to nurture your account and optimize your chances for ongoing success.

Strategies for Success in Funded Trading

Traders participating in funded trading programs can deploy various strategies to consistently meet profit targets and adhere to the criteria established by funding prop firms. Let's explore some effective strategies:

Scalping

  • A short-term strategy capitalizing on small market movements.
  • Relies on technical analysis and tick charts for quick decisions.

In our quest to help you identify the optimal forex prop firm for scalping we have released a comprehensive guide on Scalping And Prop Trading

Day Trading

  • Involves opening and closing positions within the same trading day.
  • Relies on technical indicators, chart patterns, and market news for short-term opportunities.

Swing Trading

  • Holds positions for days to weeks to capture medium-term market movements.
  • Analyzes technical and fundamental factors for trend identification.

In our comprehensive guide to the Best Prop Firm for Swing Traders, you can find all the prop firms that offer rules specifically tailored to enable swing traders to obtain or maintain funded trading accounts.

Swing Trading Friendly. A complete list of Prop firms enable swing traders to obtain or keep a funded trading account. This summary is updated; however, sometimes there are changes. Always confirm them with your prop firm.
Prop Firm Swing Trading Friendly
FunderPro  (Hold positions over the weekend and during news events. No Consistency Rule in Phase 2.)
FTMO  (FTMO is a well-known and respected prop firm, particularly favored by new traders. While swing traders may find some restrictions, they can choose the Swing account type to avoid them. Swing accounts allow overnight positions, weekend trading, and news trading without limitations. The only drawback is lower leverage (1:30), still decent. The evaluation process is relatively short, which may be a downside for swing traders with longer-term strategies. However, once evaluated, working with FTMO poses no problems.)
UltraCap Trading  (With a Swing Account, the leverage is 1:60, and traders can hold trades over the weekend.)
the5ers  (The 5%ers is a respected prop firm ideal for swing traders. It offers unrestricted overnight, weekend, and news trading. Their evaluation plan allows up to 12 months to complete and provides instant funding options. Time limits exist for reaching profit objectives in the initial program level (60 days for Aggressive, 180 days for low-risk traders), but subsequent levels have no time constraints in their instant funding program.)
City Traders Imperium  (City Traders Imperium is a promising prop firm for swing traders. It offers minimal limitations on trading and provides a generous time limit to reach profit targets during the evaluation period for the Standard and Classic programs. However, a significant drawback is the requirement to close positions before high-impact news, which restricts the duration of swing trades. The Daily Trading program lacks this limitation but is more suited for daily traders. Nevertheless, if a swing trader successfully passes the rigorous evaluation process, they will enjoy greater trading freedom with fewer limitations.)
Lux Trading Firm  (Lux Trading Firm provides very appealing benefits for swing traders with features like the lack of limitations on overnight, weekend, and news trading, it offers no time limit for the evaluation stage. However, there are a few drawbacks to consider like the payout ratio (comparing with the scaling plans of other prop firms) and the requirement to use a similar lot size and risk percent per trade during the evaluation stages. )
The Funded Trader  (With a Swing Account, the leverage is 1:60, and traders can hold trades over the weekend.)

Trend or Position Trading:

  • Identifies and trades in the direction of established market trends.
  • Utilizes indicators like moving averages, momentum indicators, and trendlines.

News Trading

  • Exploits market volatility resulting from major news events.
  • Monitors news sources and economic calendars for impactful events.

In one of our guides we made a selection of the Top Prop Firms based on allowance to trade on News

Mean Reversion

  • Believes markets revert to average levels after deviations.
  • Identifies overbought or oversold conditions using momentum indicators.

Arbitrage

  • Exploits pricing disparities between different markets or instruments.
  • Requires quick trade executions and access to multiple markets.
Prop firms Allowing High-Frequency Trading. A complete list of Prop firms Allowing High-Frequency Trading. This summary is updated; however, sometimes there are changes. Always confirm them with your prop firm.
Prop Firm Prop firms Allowing High-Frequency Trading
FunderPro
OspreyFX
True Forex Funds

When selecting a strategy for a funded account, consider your personality, preferences, risk tolerance, and expertise level. Thoroughly understand your chosen strategy and adapt it to market conditions and funding firm rules. Success in prop trading requires autonomy, and as your capital grows, the need for prop firms may diminish, allowing you to operate independently.

Your Journey to the Right Prop Forex Firm

Finding the perfect prop forex firm might seem daunting, but it's all about exploring the essentials. Look into the tools they provide, check their reputation, and make sure they align with your trading goals. Take a peek at what other traders are saying through testimonials and reviews for some valuable insights. The key is to discover the firm that fits your needs as a trader. With careful consideration and some research, you'll find the prop firm that matches your goals and sets you on the path to success and profits.

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Posted by
George Milios

George Milios

Lead Generation & Business Growth Specialist

Helping Companies Scale their Organic Traffic & Conversions over the long-term by implementing strategies that work. In addition, George is an avid cryptocurrency researcher, advisor, investor, and trader.

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