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New to prop firms? Here’s how they work ⬇️

At my favorite futures prop firm (highest rated in the industry), you can pay $77 for a 50k evaluation on the core plan. If you pass the evaluation/test, then you become a funded trader and are given a trading account that is illegible for payouts. If you fail this funded account by hitting the maximum loss limit, you owe the firm nothing — they take that “loss.” In order to become funded again, you just have to pass another evaluation. And, if you earn money on a funded account, then you get to keep 80% of the profits (90% at some firms). It’s an incredible opportunity once you’re ready, but it’s a money pit if you start before you’re ready (just like ALL trading). There’s a free and full prop firm trading guide here. The only firms I work with are reliable and the highest rated — that full list is here.

Why do I personally trade through prop firms?

Easy answer. I paid $77 for the 50k core account, passed the evaluation, and made $5,000 on that account, which is now in my bank. Instead of dealing with the enormous pressure of trading a personal brokerage account and watching a position move up and down $100 every 5 seconds, I can trade risk-free knowing that it’s on the firm if I lose. The reduction of that stress allows me to execute my system without as much hesitation. If I make money, then I get to keep 80% of the profit (90% at some firms).

I would have to fail a prop firm account TWENTY SIX times with 0 payouts to spend the equivalent of losing 1 $2,000 deposit into a personal brokerage account. That is the true “leverage” and appeal of a prop firm. But what about all the rules that make it hard to get your payouts? The ones I use don’t have difficult rules. For me personally, prop firms remove a significant amount of pressure and allow me to trade position sizes that create meaningful returns (rather than being limited to 1 micro contract on a personal account). It’s an easy choice for me, but decide for yourself.

1. LESS PRESSURE

• It’s easier to trade meaningful size when the money being risked isn’t yours.

1. MONEY AND RISK

   • Since the only costs from you are paying to take the evaluation, you can’t lose anything beyond that.

2. CHEAP ACCESS TO MORE CAPITAL

   • Paying $77 for what is essentially a $2,000 trading account is a great opportunity, even if it takes a few tries to get funded.

Remember…

It doesn’t have to be one or the other. Many people I know have a personal brokerage account AND prop-firm funded accounts. Just like trading with real money before you’re ready, starting with prop firms too early is practically a guaranteed way to lose money. Start with the guide, and never risk what you can’t afford to lose. Additionally, decide for yourself on whether or not to even use firms. I personally do for the reasons already mentioned, but come to your own conclusion and think for yourself.