2.6 / 5
Rating breakdown
the5ers Review and Analysis
Overview
If you haven’t yet heard of proprietary trading firms, then pull up your trading socks and get ready. These innovative platforms put traders to the test through an in-house “challenge.” The successful few can then join the firm and begin trading with leverage of up to $2 million. The profits are shared between trader and firm, while the latter assumes all losses. Not a bad deal! That said, the challenge comes at a cost (a one-off fee), and each firm differs in the deals they cut and the platforms they offer.
The 5%ers is a prop trading firm founded by Gil Ben Hur and Snir Chiel. Both former forex day traders, Gil and Snier, experienced first-hand the frustrations that lack of capital bring to experienced traders ready to play the markets. Hence, the 5%ers Funding Program was born: a platform to reward worthy traders with significant capital, with profits shared in a win-win outcome.
The story of the 5%ers is rooted in real-life experiences by former and current forex traders. The team aspires to provide a fair framework to launch full-time traders into the markets with instant capital. The 5%ers breaks their program down into two stages: the first has greater oversight and risk management requirements. Traders who pass the first challenge can begin trading with greater leverage and less management. Significantly (where the 5%ers stand apart), both levels are funded with real money.
Funded Accounts
What are funded accounts?
Funded accounts are just this: platforms that deposit their own money into traders’ accounts, essentially “funding” their trading. In return, traders share any potential profits (percentage ratios differ across the board).
Also known as “scouting firms,” prop firms like the 5%ers are not confused with traditional proprietary firms or depositary prop firms (aka broker-dealers). The latter two platforms operate on a more formal employer/employee basis with their traders. In the case of traditional prop firms, traders may work in-situ and receive a base salary in return for their hours. Broker-dealers charge traders for training and access to the markets and do not take responsibility for losses. In return for the risk, however, the traders receive high payouts.
The 5%ers are an innovative prop firm in the line of competitors like FTMO and TopStep Forex. These firms are increasing in popularity among traders, who can access millions in leverage in return for a relatively small sign-up fee. The catch is the challenge – only a lucky few will get through and have the opportunity of trading with such high margins.
Most trading prop firms work on a two-step basis. The first stage is the challenge of a demo account with virtual money. If you pass the test, you can begin trading with real money – and real profits.
The 5%ers stand apart from their competitors for one primary reason: you begin trading with real money immediately. There is no trial process or demo account – the 5%ers cut straight to the chase with instant funding. Traders start using live accounts, and the profits earned during the initial period are forwarded to your following account for those applicants who make it to the second stage. Now we understand the primary offering of the 5%ers, let’s delve into the nitty-gritty and assess the pros and cons of this prop firm.
Challenge Overview
The 5%ers Challenge review
The 5%ers have a reasonably loose rein when it comes to their challenge. Traders have a whole six months to complete the low-risk challenge (and even then, there is leeway for extensions). HyperGrowth is a scaling feature of the challenge whereby your account balance is doubled for every goal you achieve!
Pros and Cons
Let’s talk about the good stuff…
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As we’ve seen, FTMO puts a generous package down on the table. Traders are offered instant funding in live markets. There is a catch (there’s always a catch!), but we’ll cover the downsides below. First off, here is what to love about the 5%ers:
- Funding: The 5%ers let you trade live from the get-go, and your first profit is money in the pocket. They are likely to make their money back with the sign-up fee. The 5%er one-time participation fee will set you back €235.
- Low risk: There are several account options on the 5%er platform. First-time users will be limited to low-risk funding. This comes with lower leverage, and traders have 180 days to pass this challenge.
- Leverage: With the higher risk account, the 5%ers will let you trade with leverage of up to 1:30 (versus 1:6 above). There is also more significant pressure to hit higher profit targets with the increased leverage. The high-risk account requires a 25% return to roll forward to the next level.
- Challenge: The 5%ers have a reasonably loose rein when it comes to their challenge. Traders have a whole six months to complete the low-risk challenge (and even then, there is leeway for extensions). HyperGrowth is a scaling feature of the challenge whereby your account balance is doubled for every goal you achieve!
- Trading: Again, the 5%ers have laid a generous offering on the table. Unlike many prop firms, traders can hold their positions over the weekend, and there are no drawdown limits. Any trading has the green light, and there is no restriction on news trading.
The 5%ers do a neat 50/50 profit split with successful traders. While this seems fair on paper, many of the rival prop firms offer much higher ratios. Therefore we’ve decided to view the payout scheme as the weakest point of an otherwise fairly good all-rounder.
There are other holes in the 5%er offer too. The firm imposes restrictions on lot sizes [**this may no longer be true, have they removed the 0.65 lot limit?**] which doesn’t suit many trading styles.Evaluation Metrics
Overall metrics
- To truly evaluate what the 5%ers bring to the trading table, we scored each aspect of the 5%ers Challenge individually.
- Challenge difficulty: The 5%ers Challenge is by no means the most difficult. The fact that you are instantly funded and have a whole 180 days to complete the initial challenge makes the 5%ers one of the more straightforward options. That said, the price you pay is with a meaner margin of profit shares. You may get your foot in the door quicker, but there will be less on the other side as a result!
- Flexibility: The 5%ers make up the slack when it comes to the rules of using their platform. There are no restrictions on trading style, news trading, or the holding of weekend positons. For this reason, we give them a generous mark.
- Fee: The the 5%ers Challenge fee is on the higher end of the spectrum at $275 per attempt. That said, you access immediate funds from the first use, which does compensate the sign-up fee for those successful traders.
- Payout scheme: the 5%ers scores poorly on this metric as their payout is significantly lower than competitors such as TopStep and FTMO. That said, however, where the platform disappoints in the 50% share they make up for with the exponential growth option: your account balance doubles with every milestone you reach.