Is Topstep Regulated? Is it safe? - TU Expert review
License is the most important document you have to consider when choosing a broker. Many traders, who would like to start working with Topstep try to check whether it is regulated. Traders Union experts have already done that. In this article, you will learn whether Topstep is regulated, what regulatory authorities supervise the broker and whether it is safe to work with the company in general.
Short summary about the broker Topstep
Topstep is a leading proprietary trading firm offering traders the opportunity to trade futures contracts. With a unique two-step evaluation process, traders can prove their skills on a simulated account before potentially receiving funding for live trading.
Topstep offers three account sizes: $50,000, $100,000, and $150,000. Regular pricing starts from $165/month, with frequent discounts available. Traders can leverage up to 1:100 and access diverse futures markets, including stocks, commodities, crypto, bonds, and metals. Commissions and fees charged on the Trading Combine (simulation account) align with those on a live funded account, helping traders develop skills for real markets.
Topstep supports traders with educational resources, including free group coaching, to enhance their chances of success.
| 💰 Account currency: | AUD, CAD, COP, GBP, JPY, EUR, MXN, and USD |
|---|---|
| 🚀 Minimum deposit: | $1 |
| ⚖️ Leverage: | 1:100 |
| 💱 Spread: | Float |
| 🔧 Instruments: | Futures of the CME group: for stocks, commodities, bonds, and metals |
| 💹 Margin Call / Stop Out: | The broker closes all open positions automatically every Friday |
Pros and cons of Topstep
👍 Advantages of trading with Topstep:
•Real trading accounts are financed by a broker, there is no need to invest your funds in trading.
•The company provides a wide range of free training materials, including free group coaching.
•You can contact the support team using several convenient methods.
•The broker offers a referral program for extra income.
👎 Disadvantages of Topstep:
•The company doesn’t offer bonuses, automated trading, or other passive income options.
•The support service works only on weekdays during set hours.
Why is it important to work with a regulated broker?
License is a document that certifies that a broker operates legally and guarantees fulfillment of its obligations to the traders. A financial license is issued by a financial regulatory authority of a country (the National Bank) or a specialized authority (for example, Securities Commission, Futures Trading Commission, etc.). It is important to choose licensed brokers for the following reasons:
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A license guarantees that the broker operates in compliance with the rules of the financial regulator that issued the document.
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In order to obtain the license, a broker must comply with certain requirements, for example, the size of the authorized capital or personnel qualification. It is simply not lucrative for scammers to comply with such requirements.
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A broker’s license provides access to real markets, and you can be sure that the quotes are real and up-to-date.
The best option is to work with a broker that holds the license of the jurisdiction, where the trader resides. You can also choose a company with a financial license of another reliable jurisdiction, for example, the U.S. or the European Union.
Is Topstep Regulated? Broker’s license
Security (Protection for Investors)
Topstep is registered in Chicago, Illinois, in the USA. It allows its clients to trade on simulated accounts while having access to real market conditions.
Trading on a real account is carried out through the Equiti Capital broker. This company is registered in the UK and licensed to provide financial services under No. 07216039. The activities of Equiti Capital are governed by the FCA (Financial Conduct Authority, 528328).
👍 Advantages
- Live trading is done through a regulated broker
👎 Disadvantages
- Topstep doesn’t provide license or regulation data
Brokerage fees
Broker’s regulation is the most important choice criterion. However, before you start working with the broker, it is also important to analyze its commissions and fees. TU analysts have studied the commissions and fees charged by Topstep, which you can see below.
The experts at the Traders Union inspected this broker looking for hidden fees and to establish the size of the commissions for trading and non-trading operations. No hidden fees were found. The withdrawal fee is $50; if the fee exceeds $500, the fee is paid by the brokerage company. There are no fees for using the trading platform, quotes, or other Topstep services. When opening a Trading Combine account, the trader is charged a monthly fee of $165, $325, $375 for futures trading. It is impossible to identify the minimum spread indicators since Topstep has a floating spread and its size depends on the volatility of a particular asset. The commission for 1 standard lot is $8. If you have chosen a different base currency, the commission is automatically calculated based on the current exchange rate.
| Account type | Spread (minimum value) | Withdrawal commission |
| Trading Combine | from $8 | Withdrawals are not available |
| Funded Account | from $8 | If the commission is up to $500, the trader pays a withdrawal fee of $50. A fee of $500 or more is paid by TopStep |
Brokers that are similar to Topstep
Many brokers operate legally, obtaining relevant licenses and permissions. However, when choosing a broker, it is important to compare their trading conditions. TU experts have prepared a comparative analysis of Topstep conditions with its closest competitors.
Comparison of Topstep with other Brokers
| Topstep | FTMO | Funded Trading Plus | The5ers | Audacity Capital | Earn2Trade | |
|---|---|---|---|---|---|---|
Account currency |
AUD, CAD, COP, GBP, JPY, EUR, MXN, and USD |
USD, EUR, GBP, CZK, CAD, AUD, CHF |
USD |
EUR, USD, GBP, JPY, CAD, AUD, NZD, CHF |
USD |
USD |
Minimum deposit |
$1 |
From €155 |
$119 |
$85 for the education program and $235 for the standard account |
From £149 |
$90 |
Leverage |
1:100 |
Up to 1:100 |
Up to 1:30 |
Up to 1:30 |
Up to 1:100 |
No |
Spread |
Float |
No data |
From 0 pips |
N/a |
No |
A fixed payment for a contract for each instrument + fees charged by regulators, liquidity providers, and futures exchanges |
Instruments |
Futures of the CME group: for stocks, commodities, bonds, and metals |
Currency pairs, stocks, stock indices, commodities, cryptocurrencies |
CFDs on currency pairs, indices, precious metals, energies, and cryptocurrencies |
Currency pairs, precious metals, indexes, securities |
Currencies, indices, commodities |
Futures and micro futures |
Margin Call / Stop Out |
The broker closes all open positions automatically every Friday |
No data |
Set by a broker |
No |
No |
No |
Topstep is a broker for active traders who are ready to improve their skills. The company cooperates with clients regardless of trading experience and, when opening an account, takes into account the results of trading on a simulation account.
FTMO is a prop company for traders with trading experience, hard testing conditions, and attractive conditions for those who go into real trading. FTMO - Pros and Cons for Beginners.
Funded Trading Plus is registered in the UK and provides quite loyal working conditions for traders with diverse experiences. It offers complete freedom of action, and there are no restrictions on methods, strategies, and challenge deadlines. Scalping, hedging, and use of advisors are allowed. The profit split for real trading is fair and brokerage fees of its partners are below market average. Also, the prop firm offers a partnership program with substantial payouts and occasional promotions.
The5ers company is unique. It allows a trader with any level of experience to start trading with a large fund, which potentially increases profits. The platform takes 50% of the trader’s profit from bonus funds. The5ers has a convenient demo account and an in-depth education program that allows you to quickly increase your level of trading skills and the success of your trading strategies.
Audacity Capital focuses on cooperation with traders of all levels. It has a fairly low entry level in terms of trading skills, but traders should consider the relatively high initial fee and monthly fees. Audacity Capital offers two types of accounts with leverage of up to 1:100. A trader starts with a balance of $15,000 and can increase it up to $480,000. The main instruments of the company are currencies, but under certain circumstances, a partner also gets access to the markets of indices and commodities.
The Earn2Trade company is meant for retail futures traders who want to become professionals and manage substantial capital.
Conclusions
Topstep can certainly be considered a reliable broker. The company operates on the license that was issued by a reputable jurisdiction. The broker has a good reputation and offers attractive trading conditions. This makes Topstep a good choice for traders.
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FAQ
How difficult is it to obtain a brokerage license?
The procedure for obtaining a license differs depending on the jurisdiction, but it is very difficult and expensive to get the document in a reliable jurisdiction. This is why only reliable brokers obtain licenses.
Why is it not recommended to work with offshore brokers?
Offshore brokers have to meet minimum requirements for obtaining a license and reporting, which is why often scammers get such licenses.
Can an offshore broker be reliable?
Yes, although there are not many of such brokers. There are brokers with a good reputation, but with an offshore license. You still need to be very cautious when working with such companies.
How do I check a broker’s reputation?
In order to check a broker’s reputation, you need to read user reviews. However, it is recommended to only use independent websites for that.
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Team that worked on the article
Mikhail Vnuchkov joined Traders Union as an author in 2020. He began his professional career as a journalist-observer at a small online financial publication, where he covered global economic events and discussed their impact on the segment of financial investment, including investor income. With five years of experience in finance, Mikhail joined Traders Union team, where he is in charge of forming the pool of latest news for traders, who trade stocks, cryptocurrencies, Forex instruments and fixed income.
Olga Shendetskaya has been a part of the Traders Union team as an author, editor and proofreader since 2017. Since 2020, Shendetskaya has been the assistant chief editor of the website of Traders Union, an international association of traders. She has over 10 years of experience of working with economic and financial texts. In the period of 2017-2020, Olga has worked as a journalist and editor of laftNews news agency, economic and financial news sections. At the moment, Olga is a part of the team of top industry experts involved in creation of educational articles in finance and investment, overseeing their writing and publication on the Traders Union website.