Best prop companies for day traders

What Is a proprietary trading firm?

A prop trading firm is usually a big financial institution that engages directly in stock market activities. Prop trading occurs when a trading desk at a financial institution uses the firm’s resources and accounts to carry out self-promoting monetary trades. These trades are often speculative in nature and are performed through a range of derivatives or other complex investment vehicles.

However, it isn't the firm as an entire entity that engages in the trades, it does so through prop traders. A prop trader gets into an agreement with the organization as an independent trader and not an employee or client, to conduct day trades through the company's account. The trades are done with company funds.

However, to become a prop trader, you have to first deposit an amount usually referred to as risk contribution. Your risk contribution determines how much leverage you are given by the company. I’m sure you are wondering why it’s called risk contribution. This is because any losses incurred during a trade are offset by the trader’s deposit (risk contribution).

The risk contribution shows that you have the company’s best interests at heart and you will not get involved in extremely risky trades because you will lose your money as well. The company and not the prop trader is the party to each stock trade and so it is the one that sustains any losses in any trade.

How can I get a job in a prop trading company?

Getting a job in a prop trading firm can be highly competitive, as these firms are typically looking for top performers with strong financial backgrounds. To land such a position, it is important to have extensive knowledge of the markets and advanced skills in quantitative analysis and risk management.

Having experience or qualifications in economics and finance will also give applicants an edge over others. It is essential that candidates demonstrate their ability to develop strategies for achieving maximum returns while understanding the risks inherent in any trade.

Therefore, to land a job at a prop trading company, you usually need to go through some kind of competition and confirm your trading skills. Then, you can get management from 10K to 1KK and get up to 90% of the trading profit.

Below is a general overview of the qualifications needed to get a job at a prop trading company.

Exceptions do exist, and English Literature majors and students from non-target schools can also get in. There is just more work and networking required.

You can approach a prop trading firm once you have accumulated sufficient knowledge, skills, and tools to successfully conduct prop trading. Before making a commitment to a firm, it is advisable to conduct research and background checks on them. In order to access high leverage, you must deposit a risk contribution once you are satisfied that the organization is credible.

You are likely to gain access to advanced and sophisticated technology when you conduct in-house prop trading at the firm's premises. As a result, you will also gain access to high-level information that will allow you to make more successful trades. Alternatively, licensed software can also be used to trade remotely. However, remote trading does not offer the same advantages as in-house trading.

7 best prop trading firm accounts 2024

1 Topstep Forex

Topstep Review

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As a broker, Topstep has always had an outstanding reputation, fantastic trader support, and very generous payouts. As a result of their current promotion, they're one of the best bargains in the industry for forex trading.

You keep 100% of your first $5,000-$10,000 profit when you first get started (depending on which account you choose). In addition to that, you will still get 90% of your profits going forward, which is the industry's highest payout ratio.

Furthermore, Topstep has streamlined its two-step evaluation process, known as Trader Combine. The minimum trading requirement in Step 2 has been eliminated, so both steps can be completed in less than two weeks.

To pass the Trader Combine, Topstep gives traders unlimited time to hit their profit targets. No matter how long it takes, just make sure you don't reach your loss limit or trailing maximum drawdown. While you're in the Trader Combine, you'll be charged a monthly fee, but once you're confirmed as a funded trader, those fees will disappear.

2 SurgeTrader

SurgeTrader Review

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SurgeTrader offers 75% profit splits to funded traders who meet their trading criteria. It's the perfect prop firm to diversify your investment portfolio with a variety of tradeable assets.

SurgeTrader has only one phase of evaluation, unlike many other prop firm trading entities. Traders of all skill levels can choose from six packages. With its Starter Package, you get $25,000 in instant funding and a 10% profit target. There’s a maximum trailing drawdown of 5%. The Starter Package is ideal for beginners who want to avoid aggressive accounts.

With a $1 million funding size and 75% profit split, the Master Package is the highest-tier account. A 10% target is set, along with a four-percent daily loss limit and a five-percent maximum trailing drawdown. If you have a lot of confidence in your abilities, this package may be for you.

Additionally, this prop firm offers a wide variety of tradable securities, including crypto and gold, as well as popular stock indices. It’s possible to leverage up to 1:10.

A top proprietary trading firm, SurgeTrader requires all of its clients to undergo evaluations. You need to pass only one phase of the SurgeTrader Audition process. It’s not necessary to earn over 10% of your account balance in order to pass the audition.

Audition fees range from $200 to $6,500 per account. There’s no limit to how many times you can take the audition. You can use credit/debit cards and PayPal to make payments and withdrawals.

3 Fidelcrest

Fidelcrest Review

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Fidelcrest offers 13 accounts to suit different types of traders, providing access to more than 1,000 financial instruments. Known for its robust training programs and exceptional support services, the prop firm offers profit splits of up to 90%.

There are two main accounts available at Fidelcrest, Micro Trader and Pro Trader, both of which offer Normal and Aggressive settings. Each risk type is funded at three different levels.

Depending on the risk type, the Micro account has funding between $25,000 and $50,000. A difference between the two lies in the profit targets, the minimum number of trading days, and the maximum loss limits. Micro Trader, for example, has a maximum overall loss limit of 10% and a profit target of 5%. There is a maximum loss of 20% with Aggressive risk, and a maximum profit target of 15%.

Currently, ProTrader accounts are funded between $150,000 and $1 million, of which $1 million is only available for Normal Risk accounts. Both accounts can be leveraged up to 1:100.

Each account type is evaluated in two steps, depending on the minimum number of trading days, maximum daily loss limit, and maximum overall loss limit. The KYC program at Fidelcrest requires that you submit documents in addition to meeting the trading parameters.

The fees for different types of accounts and risk levels vary. It costs between $104 and $474 to open a Micro Normal risk account. The prices for Micro Aggressive accounts range from $157 to $579, while those for ProTrader accounts range from $685 to $2,848

4 FTMO

FTMO Review

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In addition to offering the best profit splits in the business, FTMO lets you trade almost all financial instruments. Probably the largest prop trading firm in the world, they have more than 10,000 traders worldwide.

There is a good reason why FTMO has a great reputation. Their payments are always on time and they don't make accounting errors.

The industry's highest rate of profit splitting is 90% for the truly elite traders, which is based on a sliding scale that begins at 80%.

As well as offering great scaling opportunities, they are also very affordable. The FTMO Challenge, one of the two stages of the evaluation process, allows traders to access up to $400,000. The FTMO will incrementally raise your funding to a maximum of $2 million if you generate a 10% net profit over a certain period of time. Funding their traders accordingly is a key factor for FTMO since they recognize that it takes money to make money.

Trading at FTMO is also possible in almost every financial market you can think of. You can trade forex, futures, metals, and equities if you've mastered a particular market. In contrast to many prop trading firms, which are only focused on very specific markets, FTMO allows you to trade anything you like.

As well as excellent trading platforms, they also offer excellent educational resources. This is due in large part to their investment in new trade tracking technology. You can track your trading habits and receive real-time feedback using FTMO's apps.

FTMO employs trained psychologists as part of their commitment to helping their traders. Even though psychological aspects of trading are well known, FTMO is one of the few prop firms that offer support here.

The parameters of the evaluation are pretty standard, but they’ve made some concessions recently to make things easier. The maximum losses on a $10,000 account are $1,000, and your profit targets are 10% over 10 trading days for Step 1, but they've cut the Step 2 target to 5%, which eliminates most of the pressure.

FTMO is one of the most affordable reputable prop firms. For a $10,000 funded account, prices start at just €155. In the event you pass the two-step evaluation process, this one-time fee will be fully refunded.

5 The 5%ers

The5ers Review

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Your capital is at risk.

Proprietary trading firm The 5%ers offers great trader support, instant funding, and quick account scaling.

Like FTMO, the 5%ers often pay out on time and accurately, as well as educating their traders. 5%ers give you immediate access to real capital, unlike FTMO.

As a prop trading firm, The 5%ers has one of the most effective evaluation processes in the business. Even though they offer instant funding, the 5%ers still have an evaluation stage, called Level 1. But during your evaluation, you’ll earn real profits and trade real money.

Real money is immediately available for trading. Depending on the account size you choose, you can have an account with up to $20,000. If you achieve your profit goals within 180 days, you split the profits and become a fully funded trader. When you become a fully funded trader, your initial balance will be multiplied by four times.

Although the 5%ers offer generous funding, they don't make it difficult for the company to achieve profitability objectives.

6% profit is all you need to move on from Low Risk accounts. The best part is that there is no minimum trading day requirement. A profit of 6% on your first day will qualify you for full funding.

In theory, you could start trading with up to $80,000 just a few days after opening an account.

While the 5%ers offer only forex trading, they aren't too restrictive when it comes to trading strategies. Positions can be held overnight and over the weekend.

Aside from offering a great scaling program, the 5%ers also offer a great mentoring program. The company will double your capital every time you reach a 10% profit goal up to $2.56 million as soon as you become a funded trader.

A majority of online reviews mention The 5%ers' trader assistance, community, and customer service. It has only taken the 5%ers a short time to build a community of loyal traders who appreciate their overall support of traders.

Furthermore, funded traders can withdraw profits at any time, as often as they like, and for as much or as little as they like.

6 My Forex Funds

Founded in 2020, My Forex Funds is a proprietary trading firm based in Toronto, Canada. More than 40,000 traders from 120 countries were funded by this firm in one year, making it one of the fastest growing firms in the industry.

There are a variety of programs available that can be adapted to different profiles of traders, even one does not require prior evaluation and you start with a real funded account. A profit sharing account can reach up to 85%, with a maximum size of $2,020,000 at your disposal.

There are three different programs offered by My Forex Funds available on a one-time payment basis without recurring monthly fees.

Rapid accounts offer 12% profit on day one while you pass the evaluation process. A range of $10,000 to $100,000 is available for funding. There are two stages in the evaluation process for the Evaluation account (the first stage targets 8% profit, and the second stage targets 5% profit). A range of $10,000 to $100,000 is available for equally funded accounts.

There is no evaluation process in the Accelerated program, where you trade with a live account from day one. Account balances range from $2,000 to $50,000 and can reach $2 million. In general, the rules for complying with this prop firm vary based on the program selected, but the most common are:

7 The Funded Trader

With The Funded Trader Program, you get access to industry-leading prop firms like no other prop firm. There is no regulation of your trading style with the FTP. They also allow traders to trade overnight, during news, and on weekends. Traders can choose from two funding options offered by the prop firm.

There are two types of challenge accounts: Standard Challenge Accounts and Specialist Challenge Accounts. Once the two-phase evaluation period is over, traders are rewarded for their consistent performance. Traders can trade using a leverage of 1:200 on the evaluation program account.

The Rapid Challenge Accounts also identify serious traders and reward them for their consistency during the two-phase evaluation process. Only here, traders are allowed to trade with 1:100 leverage. The Funded Trading Program is one of the best prop trading firms because of this, as well as relaxed trading rules. Profits are split up to 90%.

How much money can I make?

When it comes to prop trading, the potential for making money is largely dependent on your individual level of skill and experience. Professional traders working in proprietary trading firms may make up to 70-90% of their trading profit if they meet profit targets.

Profits from trades are usually shared between the firm and the prop trader, but there is asymmetric risk. In other words, if you suffer a loss, you will bear 100% of the loss while you will not receive 100% of the profit. In most companies, prop traders receive between 10% and 25% of profits. It is important for you to realize that trading, especially day trading, is highly volatile, which means you can make millions but also lose them.

The amount can be further influenced by factors such as the size of a particular trade and the volatility of the markets at any given time. With an adequate understanding of market dynamics and risk management strategies, experienced prop traders have been known to generate sizable profits within short periods despite considerable risks associated with this kind of trading activity.

By taking advantage of price movements and investing with long-term objectives in mind, successful prop traders are able to capitalize on opportunities presented in volatile markets while minimizing losses if things don't go according to plan.

Will I get a salary as a prop trader?

Yes, you can earn a salary at a prop trading firm. As a trader at a legitimate prop trading firm, you can expect total compensation of between $100K and $200K USD. The base salary is slightly over $100K, and bonuses are usually 50-100% of it.

Top firms might even offer you a total compensation of more than $200K, but it depends on the market conditions and your performance. Losing money means no bonus and eventually being fired if you keep doing poorly. If you perform well at a top firm after your first year, your compensation could increase to $200K - $500K.

It is common for senior traders to earn between $500K and $1 million per year, and partners to earn over $1 million annually. Increased bonuses are the main source of these gains since base salaries do not necessarily change that much as you move up.

Compared with investment banking salaries, prop trading compensation may seem not seem much higher, but it has two distinct benefits:

If you are very good at prop trading, you can earn $500K by your third year, which is much faster than IB. Traders who perform well can reach partner status in as little as a few years.

You earn everything in cash since there are no stock-based or deferred bonuses. The difference isn't significant at the entry level, but it becomes increasingly important as you advance.

Methodology for compiling our ratings of prop firms

Traders Union applies a rigorous methodology to evaluate prop companies using over 100 quantitative and qualitative criteria. Multiple parameters are given individual scores that feed into an overall rating.

Key aspects of the assessment include: