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Getting Started with Prop Trading
Prop firm trading can be a great path to a funded account — but only if you understand the rules. This guide walks you through everything you need to know before spending a single dollar.
What is a Prop Firm?
A proprietary trading firm (prop firm) provides traders with simulated capital to trade financial markets. You pay an upfront evaluation fee, complete a trading challenge by hitting profit targets without exceeding loss limits, and receive access to a funded account where you keep 70–90% of profits. The firm keeps the rest. Most prop firm trading is done on simulated accounts — you are not trading real client money.
How to Use Prop Firm Audit
Understand the Model
Prop firms give you simulated capital to trade. You pay an evaluation fee, pass a challenge (hit profit targets without exceeding drawdown limits), and then trade a funded account keeping a share of profits.
Learn the Key Metrics
The three most important things to compare: Max Drawdown (how much you can lose overall), Daily Drawdown (how much you can lose per day), and Profit Target (what you need to hit to pass). These define how hard the challenge is.
Read Scores Alongside the Rules
The PFA Score is an editorial comparison aid. Read the review findings, exact account terms and official payout requirements alongside the score. Newly added profiles may be awaiting a scored assessment.
Compare Firms Side by Side
Use our comparison tool to stack up firms on profit split, drawdown, platforms, and coupon codes. Never choose based on one metric alone.
Read the Full Review
Each firm page has our full audit breakdown, score by category, audit points flagged by our team, and real trader reviews with image proof. Spend time here before paying for a challenge.
Use Your Coupon Code
Open the coupon page for the firm you are comparing. Check the listed code, account-specific discount, final fee calculation and redemption steps before choosing your account.
Important Warnings
Never fund an account with money you can't afford to lose — evaluation fees are typically non-refundable.
Read the firm's full terms before purchasing. Rules can be complex and violations cause instant account termination.
Be wary of firms offering very high profit splits (e.g. 95%+) with low drawdown requirements — this is often unsustainable.
Prop firm reviews can go stale. Always verify current rules directly on the firm's official website.
Drawdown limits are usually calculated on your starting balance or highest equity — understand which one applies.
Key Terms Glossary
- Max Drawdown
- The overall loss allowance. Static limits use a fixed floor; trailing limits can rise with balance or equity highs. An EOD trailing limit moves at the daily snapshot, while the breach check may still use live equity. Read the exact account's calculation.
- Daily Drawdown
- The permitted loss within a trading day. Firms can use the day's opening balance or equity, a fixed amount based on the initial balance, or another published calculation. Floating losses, fees and the daily reset time can affect whether an account breaches.
- Profit Target
- The profit percentage you must reach to pass the evaluation phase. E.g., 10% means you must grow your account by 10%.
- Trailing Drawdown
- A loss floor that rises as the account reaches new highs under the firm's balance or equity calculation. It generally does not fall after a loss. Some models stop trailing at a specified level; intraday and end-of-day models update at different times.
- Profit Split
- The percentage of profits you keep from your funded account. Common splits are 70%–90% for the trader.
- Scaling Plan
- A structured plan to increase your funded account size as you consistently hit profit targets over time.
- EA / Expert Advisor
- An automated trading bot or algorithm. Some prop firms allow them; others ban them entirely.
- Consistency Rule
- A rule requiring that no single day's profit exceeds a certain percentage of total profits. Prevents passing a challenge with one lucky trade.
- PFA Score
- Prop Firm Audit's editorial score from 0–100, shown alongside Trading Conditions, Customer Care, User Friendliness and Payout Process assessments. It is a comparison aid, and does not guarantee financial outcomes.
Ready to Choose a Firm?
Browse forex, futures and crypto firm reviews, compare account conditions side by side, and use the relevant coupon page to calculate the purchase fee.