With so many leading prop firms, suspended the purchase of new challenges for the US market, now more than ever it is important to pick the right prop firms to trade with
During the last decade, the retail forex and prop trading sectors in the USA have witnessed a rapid growth, aided by technological advancements and the development and dominance of online platforms. This has meant that entry barriers have been obliterated and the massive global currency market, where $7.5 trillion are traded every day, lures hordes of traders who want a piece of the action.
Proof of the popularity of forex trading in the US, is the fact that every day the American forex market records a daily trading volume that is worth over $400 billion. However, besides trying their hand with retail forex trading, Americans have also grown very keen of proprietary trading, a trend that became particularly attractive in the aftermath of the devastating financial crisis that hit the USA and the entire world in 2008. What made prop trading so attractive is that it gives traders the change to make larger profits, without risking their own money, since they are leveraging on the funds of the prop firm that is funding their trades.
Therefore, though a relatively newer niche, the prop trading providers have nowadays managed to be handling over 10% of the trading volume recorded in the entire US equity markets.
In this guide we share all that you need to know if you are a US based aspiring trader, considering to make the leap and wanting to put your skills against the test, in the hope of profits though forex or prop trading.
Though forex and prop trading come with embedded risks and are characterized by increased volatility, they remain highly appealing to traders, simply because they offer access to the past-paced world of global financial markets, which can potentially be very lucrative.
According to recent statistics well over 60% of all American retail traders, i.e. individuals as opposed to institutional market players, are actively engaged in forex trading. This surge can be explained by the fact that the forex landscape is now more accessible for the masses, due to the easier access that exists to cutting-edge trading tools, online platforms and educational opportunities and resources that allow people to learn how to trade and be able to place their trades.
However, as the popularity of forex and prop trading grows, so does the scrutiny of the overarching authorities increase. Having as their main goal to manage and mitigate the potential risks for traders and also ensure that retail trading occurs under conditions of full transparency, the industry watchdogs have become stricter and their resolve has led many retail forex brokers operating in the USA to exit the field. In fact, there has been a dramatic increase of 70% in the numbers of brokers operating back in 2010, compared to 2024.
This consolidation of the landscape is not necessarily a bad development for aspiring traders, as it merely signifies that the overall retail forex market is currently more stable and being dominated by fewer key players.
Besides being the largest and most liquid financial market, the USA forex market, is also attractive to existing and aspiring traders due to the significant advantages it offers, such as the ease of access, which means that you can trade anytime and from anywhere, on a 24/5 basis. The high market volatility allows traders to capitalize on price swings, while through leverage both one’s trading power as well as the potential earnings may be greatly boosted. Moreover, you can enter the world of retail forex trading and start your own trading journey for a very low initial amount, since barriers to entry are significantly lower than in other markets.
However, to actually start placing your trades, you need to set up an account via a forex broker, and this very crucial decision may well make or break your whole endeavor.
To help you make the wise and right choice of broker to partner with to make your forex trading aspirations a reality, we have closely examined a plethora of brokers, focusing on the factors that matter most to US traders:
Our team of experts meticulously evaluated each broker, identifying their strengths and weaknesses to bring you a curated list of the top-notch brokers in the US forex market. Ready to meet your perfect match? Here we go:
While forex trading in legal in the USA, this is only the case when done through brokers that are properly licensed to operate in this jurisdiction. It is to the benefit of traders that trading in the USA comes with a strong safety net, where watchdogs keep a close eye on the market and submit all brokers to regular audits to ensure compliance. Perhaps more than any other country in the world, the US takes a strict approach to regulation, prioritizing trader protection and market integrity. Here's what you need to know about before embarking on your trading journey as a US based trader:
Although mentions of CFTC registration and NFA membership usually feature prominently on brokers’ websites, to be on the safe side and avoid unscrupulous scammers, it is better and wiser, prior to opening your trading account, to verify the broker’s regulatory status independently, through:
If still in doubt you may also contact the watchdogs directly with questions or queries about the specific broker. In the end it is up to you to act prudently and chose a broker that prioritizes your security in the US forex market, by operating legally.
Imagine trading with a firm's capital, accessing larger accounts, and amplifying your potential profits. That's the power of prop trading! Prop firms offer a unique opportunity to elevate your trading game, providing resources that go far beyond typical retail accounts.
However, choosing the right prop firm is once again the most crucial decision you will be called to take and you should be on the lookout for a reputable firm with a transparent evaluation process. Many firms use specialized competitions and trails to test your trading skills and discipline under real market conditions, providing valuable feedback to refine your strategies before you start trading with their funds. The best firms also offer access to experienced mentors and sophisticated risk management tools – resources usually out of reach for mere retail traders. The rationale is that since prop firms fund your trading, and take a percentage of your profits, it is in their best interest to equip you as best they can so that you can trade successfully.
Prop trading is reshaping the trading landscape, since it gives independent traders a chance to further capitalize on their skills and maximize their earning potential by leveraging on the funding prowess of prop firms.
If you wish to jump on this bandwagon, as a US trader, read on for some essential tips on how to best navigate this exciting and challenging ecosystem.
Proprietary trading firms present an exciting opportunity for traders eager to advance their skills and expand their financial opportunities. By offering a unique combination of capital, resources, and a professional setting, these firms pave the way for traders to reach new heights. What makes prop trading such an appealing choice are the key advantages it offers, which pertain to:
One of the most significant obstacles for aspiring traders is the lack of substantial capital to trade with. This limitation can hinder potential profits and growth. Prop firms eliminate this challenge by offering funded accounts, which allow you to trade with much larger sums than you might otherwise be able to access on your own. This expanded capital base not only increases your potential for higher returns but also enables you to apply more sophisticated trading strategies that require greater leverage.
Prop firms cultivate a highly structured and supportive trading environment, tailored to help traders succeed. Being part of a prop firm means you’re surrounded by a community of like-minded individuals, all striving to refine their craft. The collaborative atmosphere encourages knowledge sharing and teamwork. This professional setting fosters discipline and focus, which are essential traits for success in trading.
One of the most valuable benefits prop firms offer is the opportunity to receive direct mentorship from seasoned traders. These mentorship programs provide you with personalized guidance, helping you navigate the complexities of the market while avoiding common mistakes. Whether it’s refining your trading strategies, improving risk management, or understanding market psychology, having access to an experienced mentor can significantly accelerate your learning curve and boost your confidence as a trader.
Prop firms provide access to state-of-the-art trading tools, platforms, and software that are often beyond the reach of individual traders due to their cost or complexity. These advanced tools give you an edge in market analysis, enabling you to make more informed and precise trading decisions. Whether it’s algorithmic trading platforms, real-time market data feeds, or sophisticated risk management systems, the technology available through a prop firm can significantly boost your trading prowess.
If you already are a driven trader with a solid foundation on trading and you are looking for ways to elevate your trading career, then joining a prop firm could well be the best decision you ever take. For traders looking to fast-track their growth and achieve consistent success, a prop firm can be a powerful catalyst in turning your trading ambitions into reality, as reliable prop firms try to offer you a world that is designed to help you succeed. Once again then, this highlights the significance of choosing the right the right prop firm for you. And for US based aspiring prop traders, this is perhaps the most challenging and daunting task, for the reasons explained below.
Prop Firm | Prop firms that allow clients from united states |
---|---|
FunderPro | |
FundedNext | |
FXIFY | |
SabioTrade | |
FTMO | |
Toptier Trader | |
UltraCap Trading | |
MyFundedFX | |
OspreyFX | |
Topstep | |
Blue Guardian | |
Funded Trading Plus | |
Funding Pips | |
Earn2Trade | |
E8 Markets | |
Lux Trading Firm | |
Goat Funded Trader | |
The Trading Pit | |
My Forex Funds | |
The Funded Trader | |
SurgeTrader | |
Alpha Capital Group | |
Alphachain | |
Bespoke Funding | |
BluFX | |
BuoyTrade | |
Leveled Up Society | |
FTUK | |
Funded Academy | |
Ment Funding | |
Alpine Funded | |
True Forex Funds |
Prop Firm | Prop firms that restrict clients from united states |
---|---|
the5ers | |
City Traders Imperium | |
Audacity Capital | |
Finotive Funding | |
PipFarm |
While prop trading in the US isn't directly licensed (since prop firms don't offer financial services to external clients), US market regulators still exert considerable influence on this market segment as well, in two main ways:
When you trade with a prop firm, the earnings you generate are subject to taxation, just like profits from traditional forex or securities trading. In the US, this typically means that you are liable for the payment of capital gains tax on the profits you achieve. The exact rate you will be called to pay, depends on several factors, such as the period for which you hold the assets before selling (short-term vs. long-term capital gains) as well as your individual income tax bracket. It's always a good idea to consult with a tax professional to ensure you understand the specific tax implications that apply in your particular case, although the general rule to remember is that prop trading gains do not get different treatment than profits make through other types of trading.
As already pointed out, following its initial booming period, the prop trading industry has recently been navigating a turbulent period, with a confluence of factors creating a challenging environment, particularly for US-based traders. This big storm of multiple challenges that existing and aspiring prop traders had to swim through, was the result of the devastating effect of the following developments in combination:
In the aftermath of these developments, the effects had been detrimental for the entire field of prop trading and the exodus of more prominent players, such as The Funded Trader, left many traders in shock, having suffered significant losses and with their confidence in the industry obliterated.
The impact of all the above on US traders has been particularly pronounced, since many prop firms, in an effort to navigate the stricter regulatory environment and maintain their MetaQuotes licenses, have opted to restrict access to US traders to avoid further scrutiny or troubles from the US watchdogs. Consequently, this has seriously limited the available options for US-based individuals seeking to engage in prop trading.
However, as the storm appears to have subsided, a glimmer of hope can be seen as the prop trading firms remaining in the market are coming to terms with the new environment and reality.
Those more resilient and readier to adapt and move on, are already spearheading the way ahead. As a result, firms seeking to diversify their trading technology may now choose between Alternative trading platforms such as Tradelocker, DXTrade and CTrader.
Moreover, some firms, like FunderPro, have proactively taken steps to mitigate risks and maintain stability, providing a more secure and reliable environment for traders, including those in the US. In fact, as things stand today, our team of resident experts believes that currently FunderPro is the best choice for US based prop traders.
This recent period of upheaval has once again underscored the dynamic nature of the prop trading industry and highlights the vital importance of choosing a prop trading firm that prioritizes stability, transparency, and regulatory compliance, in order to maximize your chances for success and be allowed to reach your full potential as a trader.
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