Prop trading firms – short for proprietary trading firms – are a type of trading company that hires professional traders or offers training for new traders to trade using the company’s capital. The company benefits from onboarding experienced traders, and the traders benefit from higher leverage and generous payouts.
Prop trading firms support most asset classes and include instruments like stocks, options, forex, cryptocurrencies, and more. Prop trading firms are very flexible in terms of their strategy; as long as you turn a consistent profit and follow the rules. The best prop trading firms offer anywhere from 75% to 90% of your profits as payouts.
Prop trading firms have different requirements, and even though previous trading experience is recommended, it isn't mandatory. When you sign up for a prop trading firm, you usually pay a small fee to complete a trial – if you pass, you get your own funded account and can start trading using the company’s capital.
Trials are designed to showcase your risk management skills and understanding of the financial markets and usually involve reaching profit goals while minimizing daily losses and fluctuations. Keep in mind that for these companies, a solid trader that makes steady profits is better than an unstable one.
Headquartered in Chicago, Topstep is one of the largest prop trading firms, with thousands of investors worldwide and 600+ funded accounts approved monthly. When you sign up for the Topstep Trading Combine, you can choose from three different account sizes, ranging from $50k-$150k; this size will determine your buying power when you pass the trial and get your funded account.
With Topstep, you can get your funded account in as little as eight days, and the average payout processing time is just 7 hours. Another feature we like about this platform is that you get to keep 100% of the first $5,000 you make – and 90% afterward, with no limits.
Topstep has very straightforward rules and a dedicated group of experienced coaches that will help you make the most out of this platform after you receive your funded account. If you sign up using our link, you’ll get a generous bonus – ranging from $165-$375 – with your first payout.
Founded in 2014, FTMO is one of the most established prop trading firms worldwide. FTMO was designed with forex traders in mind, but it also supports other securities and crypto. FTMO has an extensive Evaluation process that all traders have to go through and complete. This process is considerably longer than Topstep Traders’ and can take anywhere from 30 to 90 days.
FTMO is available in more than 180 countries worldwide, and they have paid out more than $100 million to funded traders since its launch. With FTMO, you can access up to 1:100 leverage on most trades, and the profit split starts at 80% and goes as high as 90%.
One feature we like is that you can get a full refund when you pass the FTMO Challenge – if you’d instead give it a try before signing up, FTMO offers a free trial. Alternatively, if you sign up with our link, you can invite friends and earn free access to the FTMO Challenges.
City Traders Imperium is a UK-based proprietary trading firm that offers advanced forex packages for experienced investors. With City Traders Imperium, you can choose from four trading accounts – CTI Challenge, Standard Evaluation, Classic Evaluation, and Direct Funding –and access different funding options.
All accounts have different rules and requirements, but you can expect similar timeframes as those of FTMO – around 90 days to get a funded account. We recommend City Traders Imperium as one of the best options for beginners looking to access excellent resources and 1-on-1 learning courses.
With City Traders Imperium, you can trade all major and minor forex pairs, various commodities, and all major indexes. Use our link to sign up, and you’ll get a discount on your first trading account, plus the option to become a partner and earn a 5% referral commission.
Prop trading firms are very profitable for experienced traders to access high leverage on all their trades. All prop trading firms listed here offer very high profit splits starting at 75% and going as high as 90%. If you’re a professional investor and think you have what it takes to earn a consistent profit, we can’t recommend the platforms listed here enough.
Yes – funded trading accounts can be profitable for experienced traders. With the proper trading account, you’ll have access to higher leverage than personal accounts, and you won’t risk your own money but instead trade with the company’s capital.
Trading through a prop firm can be a risky endeavor – and sometimes even more difficult than dealing with a traditional broker. This is due to the less regulated nature of prop trading firms compared to regular brokers. For those reasons, we recommend reading all the fine print when signing up for any of these, so you know exactly what to expect.
Prop firm challenges are demanding tests with a very low pass rate. We don’t recommend signing up for any of these platforms if you don’t have a lot of experience trading.
Yes – trading through a prop trading firm can be very profitable. For the right trader, it can be very profitable. FTMO estimates that their funded traders make up to 10 or 20 thousand dollars monthly.