A prop firm gives you simulated capital in exchange for passing an evaluation that tests discipline. You pay a one-time fee, follow set rules, and if you pass you trade a funded account and share the profits.
Typical rules: a profit target, a daily drawdown limit, a maximum drawdown limit, a minimum number of trading days, and a consistency requirement.
A two-step evaluation has two phases: the first is usually the larger target, the second is a smaller target to prove repeatability.
The profit split is the share of profits you keep, often 80–90%, sometimes higher. The trade-off is usually between entry cost, target size, drawdown limits and payout terms.
Before you pay for any evaluation, read the exact terms: drawdown calculation (static vs trailing), news-trading rules, consistency rules and payout frequency.
Different firms structure these differently. Comparing the rules is exactly why this site exists. Trading involves risk and is not a guarantee of profits or payouts.
Takeaways
- A prop firm gives simulated capital after you pass an evaluation testing discipline.
- Typical rules: profit target, daily and max drawdown, min trading days, consistency.
- Read the exact terms (drawdown type, news rules, payout terms) before paying.
Self-check
What does a profit split mean?
The share of funded-account profits you keep, commonly 80-90%.
Trading involves risk. Educational only, not advice. Mark it complete to bank progress.