Questions & Answers

1. What is prop trading?

Prop trading (proprietary trading) means trading with a company's capital instead of your own. Prop trading firms provide capital to talented traders in exchange for a share of the profits. This allows traders to trade with significantly larger amounts than they could with their own capital.

You can compare different companies on our top list. After choosing a company, you need to register, pay an evaluation fee, and pass an evaluation test to prove your trading skills.

2. Which markets can I trade?

Most prop trading firms offer trading in forex, indices, commodities, and cryptocurrencies. Some also offer stocks and bonds. The specific markets available vary depending on which firm you choose.

It's important to check that the firm offers the markets you want to trade. See our comparison page for detailed information about which markets are offered by different companies.

3. How much of the profits do I get to keep?

Most prop trading firms offer a profit split of 80-90% in the trader's favor. This means you keep 80-90% of the profits you generate, while the firm takes 10-20%. Some firms also offer increased profit sharing as you prove consistent profitability.

The exact profit split varies between firms and may depend on factors such as account size and your trading history. See our comparison page for current information about profit sharing.

4. What are the rules I need to follow?

Each prop trading firm has its own set of rules that must be followed. Common rules include:

• Daily and total loss limits (drawdown limits)
• Position size limits
• News trading restrictions
• Overnight and weekend position rules
• Minimum trading day requirements

It's crucial to understand and follow these rules to avoid disqualification. All rules are described in detail on our comparison page.

5. How do I handle taxes on profits from prop trading?

Tax treatment of prop trading profits varies by country and jurisdiction. In most countries, profits from prop trading are considered taxable income and must be reported to tax authorities.

As an international trader, you should:

• Keep detailed records of all trading activities and profits
• Consult with a tax professional familiar with trading income
• Understand the tax laws in your country of residence
• Report all income according to local tax regulations

Some countries may have specific rules for income from foreign prop trading firms, so professional tax advice is recommended.

6. How long does it take to get paid?

Payout times vary significantly between prop trading firms. Some firms offer payouts within 24-48 hours, while others may take 1-4 weeks. The fastest firms typically process payments within 1-2 business days after request.

7. What is the difference between different evaluation programs?

Prop trading firms offer different types of evaluation programs, typically ranging from 1-step to 3-step evaluations. Single-step evaluations are faster but often more expensive, while multi-step evaluations are more affordable but take longer to complete. Some firms also offer instant funding programs where you can start trading immediately.

8. Are there any hidden costs?

Most reputable prop trading firms are transparent about their costs. Common costs include the evaluation fee, monthly fees (if any), and the firm's share of profits. Some firms offer fee refunds after successful completion of the evaluation. Always read the terms and conditions carefully to understand all potential costs.