Join Our Cheap Prop Fund Challenge | Smart Prop Trader (2024)

FAQs

How hard is it to pass a prop firm challenge? ›

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.

The article from Lux Trading Firm provides slightly different results. 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.

Risk management is a critical component of the Funded Account Challenge. You need to have a solid understanding of how to manage risk in order to succeed. This involves setting stop losses, using leverage appropriately, and having a solid understanding of market trends.

Statistics on Average Trader Payouts

Profit Split: The average prop firm will offer a 80-20 profit split once you become a funded trader. TFT, on the other hand, gives up to a 90% split, — even as high as 95% in some promotions — the highest in the industry.

According to FTMO statistics, only about 10% of traders are able to pass the funded account challenge at any account level. This means approximately 90% of aspiring funded traders fail the evaluation and are unable to gain access to the firm's capital.

There is estimated to be a 90% fail rate of traders that take the FTMO challenge. The reason behind this is due to traders chasing the profit target with a time restriction in place. A trader doesnt know when a winning streak might occur, or when they may take a string of drawdowns.

What is the failure rate of prop traders? It is estimated that only 4% of Forex traders succeed with prop firm challenges, and only 1% of traders can generate profits consistently without violating any rules.

Key Takeaways. Profitable trading is difficult and successful traders share specific rare characteristics. It is estimated that more than 80% of traders fail and quit. One key to success is to identify strategies that win more money than they lose.

Free prop firm challenges come in various formats, but they generally share some common elements : Virtual Capital: You'll be provided with a simulated account with a predetermined amount of virtual capital, often ranging from $10,000 to $1 million.

How to crack prop firm challenge? ›

2) PACE YOURSELF, START SMALL AND ALWAYS RISK LESS THAN 1% PER TRADE (especially for Day Traders and Scalpers): When facing a prop firm challenge, the first thing they aim to teach you is risk, the second is patience. There are limits to how much you are allowed to lose in a prop firm-funded account.

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.

Profits from trades are generally divided between the firm and the prop trader; however, the risk distribution is asymmetric. This means that in the event of a loss, the trader bears 100% of the losses, while they don't receive 100% of the profits.

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.

There is a very slim likelihood that they will succeed if the prop firm does not have their best interests in mind. Actually, one could compare the 95% of prop companies to a pyramid scheme. They either set you up to fail or compensate you with other traders' losses.

There is estimated to be a 90% fail rate of traders that take the FTMO challenge. The reason behind this is due to traders chasing the profit target with a time restriction in place. A trader doesnt know when a winning streak might occur, or when they may take a string of drawdowns.

When you are trading with a prop firm, your losses are usually limited to the foregone risk of your challenge/account fee. You are generally not liable for the prop firm's lost funds.