What Is A Prop Firm?
A proprietary trading firm, a prop firm, funds traders with its own capital and shares the profits with them. Instead of risking your own savings, you prove your skill in an evaluation and then trade firm money.
How a prop firm works
A modern online prop firm runs an evaluation: you pay a one-time, often refundable fee, trade a simulated account to a profit target while respecting risk rules, and on passing you receive a funded account. From there you trade firm capital and keep the majority of the profit.
The model aligns incentives. The firm only makes money when its traders are disciplined and profitable, so the rules are designed to filter for risk management, not to trip you up.
How prop firms make money
Prop firms earn from two places: evaluation fees, and a share of the profits their funded traders generate. A firm that pays out reliably attracts more good traders, which is why fast, transparent payouts are a sign of a healthy firm.
- Evaluation fees from traders taking challenges
- The firm's share of funded-trader profits
- Scaling successful traders into larger accounts
Why traders use prop firms
Capital is the bottleneck for most retail traders. A prop firm removes it: a trader with a $500 account and a real edge can control $100K or more, keep up to 100% of the profit, and never risk personal savings on a losing trade.
Frequently Asked
Is prop trading legit?+
Yes, the model is legitimate. You pay for an evaluation, and if you pass you trade firm capital and split profits. Choose firms with transparent rules and a track record of paying out.
Do I risk my own money?+
Only the evaluation fee, which is often refundable with your first payout. You never have personal liability on trading losses in the funded account.
How much can I make?+
You keep up to 100% of profits on up to $400K of capital. Earnings depend entirely on your trading.
Ready To Get Funded?
Trade up to $400K of our capital. Keep up to 100%, payouts in hours, no time limits. Pick your account and pass the evaluation.
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Last updated 2026-06-11.