Which Prop Firm is best?
This is a very common question and actually not the right one. The best questions is: What is the Best Prop Firm for YOU. Not a black and white answer as there are so many determining factors. Let’s cover them:
- Products allowed to trade
- Qualifications to trade live capital
- Upfront and recurring costs
- Support and Training
- Advancement possibilities
- Profit Splits
Let’s start at the top:
Products allowed to trade: Most firms you find online will be mostly FX trading firms where they will allow you to trade spot FX and that is about it. If you are an FX trader and don’t ever want to trade any other products Maverick Currencies, E8, FTMO, TFF, TopStep, 5%ers and other are just fine. If you want to trade other products like equities, options, futures, commodities, they will not allow you to trade other products. The top equity trading firm in my opinion is T3 Trading out of New York. Maverick Trading specializes in Option trading if you are interested in option trading.
Qualifications to trade live capital: Based on your prior trading success and experience, you will want to choose the best firm for you. Most of the FX firms like FTMO, TFF, TopStep, etc. will allow pretty much anyone with a pulse to take their challenges and try to pass to become funded. Others will require passing of tests, demo trading, etc before you earn trading capital. I know everyone thinks they are going to step in to trading and kill it, but this is not reality sadly. If you are very experienced with 3+ years of profitable trading statements (live, not demo or backtesting), I would choose the prop firm with the lowest barrier to trading live. If you don’t have a serious, verifiable track record, I recommend spending some time with a reputable company going through their trading courses/qualification to get to the point where you can be a profitable trader. Remember, if you aren’t profitable, it doesn’t matter which prop firm you choose since you will be unsuccessful at all of them.
Upfront and Recurring Costs: Every prop firm has these. The saying you get what you pay for is true in the prop industry as well. As a general rule of thumb, the cheaper the costs, the less support and drawdown the prop firm is likely to give you. This goes back to what you need as a trader. If you are very experienced, I would recommend the lowest up front and recurring costs. If not, choose a different prop firm. Ask for a clear breakdown of ALL costs and decide which is best for you
Support and Training: Sound like a broken record here. If you are very experienced with a verifiable track record of 3+ years, you likely won’t need much support. If you don’t, get all the assistance you can. However, even experienced traders can benefit from a strong risk management team that reaches out when they see bad trading behavior.
Advancement Possibilities: Get a clear breakdown of capital advancement levels and how long it may take to get to the capital levels you desire. If you choose a lower cost prop firm but by the end of 2 years of profitable trading, you are still trading less than 100K, it didn’t make any sense. Make sure the upside potential of what the prop firm is willing to let you trade makes sense with the time and up front costs.
Profit Splits: Most firms have a graduated profit split ratio as you progress through advancement levels. I wouldn’t go under 70% up front splits and 99% splits are obviously best. But, think about it. If they are willing to give you 99% or 100% of profits, they are counting on making money off you from up front costs and recurring fees, not you as a trader. I like firms that have a vested interest in their traders being profitable.
We highly recommend you ask the question, “which prop firm is the best for me” instead of what is the best. All traders are different and all traders have different trading styles, capital levels, experience, etc. Finding the Prop Firm that allows you to trade YOUR way is the best decision.
Check out this answer on Quora: https://www.quora.com/What-is-the-best-prop-firm-out-there-I-tried-E8-FTMO-and-TFF-so-far-so-good-What-is-your-experience-with-other-prop-firms/answer/Robb-Reinhold-1?__nsrc__=4&__snid3__=69739327775
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