Prop Trading | Forex Trading | Prop Firm Trading - FundingTraders (2024)

FAQs

Why is it hard to pass the prop firm challenge? ›

Steps To Take To Pass The Prop Firm Challenges. Becoming a funded trader in prop firms is not an easy task. Prop trading firms only want the best traders who can bring about the best returns under a very short loss leash. In other words, not only do you have to achieve profit, you have to make a profit consistently.

Becoming a funded trader with a prop firm involves showcasing your trading skills and adherence to risk management during an evaluation process. While the difficulty can vary, it's achievable with consistency, dedication, and a solid trading approach.

Overview: Apex Trader Funding is the best futures prop trading firm on this list for a variety of reasons, but most notably because it boasts the highest pass rate for its evaluation program out of all the futures prop firms on this list. It is also by far the most friendly option for beginner futures traders.

According to it, 4% of traders, on average, pass prop firm challenges. But only 1% of traders kept their funded accounts for a reasonable amount of time. While this result is not nearly as bad as the one discussed earlier, it still looks bleak for prospective prop traders.

With the Prop Firm challenges, it's not just about failing or winning. You must be profitable and fulfill certain trading objectives which makes it even harder. Less than 1% of traders who attempt the challenge pass and get funded.

You have a poor risk management

Risk management is the key to successful prop trading. It helps you limit your losses, protect your capital, and preserve your psychological edge. Without proper risk management, you can easily lose control of your emotions and overexpose yourself to the market.

It's estimated that only 4% of forex traders successfully pass forex prop firm challenges, with only 1% of traders holding onto their funded accounts for the long term by not violating any rules. This number may surprise you, but it's actually built this way by design.

In conclusion, it can take around 4-5 months to pass a prop firm trading challenge and become a funded trader. However, it can take much longer than that to become a profitable trader beforehand – which is a necessity.

Prop trading can be lucrative, with earnings tied to a profit-sharing ratio. Unlike traditional brokers relying on commissions, prop traders' income directly links to generated profits. Ratios vary, often ranging from 75/100 to 90/100, offering flexibility based on experience and strategy.

Prop Firm Trader Salary

The salary of a prop trader can vary greatly depending on several factors such as experience, performance, and the size of the firm. On average, a junior prop trader can expect to earn anywhere between $50,000 to $100,000 per year, while a senior trader can make upwards of $500,000 annually.

What happens if you lose money in a prop firm? ›

Proprietary trading firms often provide evaluation accounts where you prove your trading skills. Usually, you pay a one-time fee to enter this “challenge.” If you lose money during this evaluation, you won't owe anything beyond the initial fee.

Strictly follow your trading strategy to complete the cheapest $10K prop firm challenge. Rely on your selected strategy to avoid emotion-based trading decisions that lead to major losses. Even with cheaper 10K challenge accounts – you should avoid incorporating new strategies into your prop trading plan.

For most funded trading accounts, it takes around four to five months to pass the screening process or prop firm trading challenge, before funding will be allocated to a trader.

Upon successfully passing a Prop Firm Challenge, traders may be required to fund their trading accounts with an initial amount. The firm may also have scaling plans that determine how much capital traders can access based on their performance.