How much do prop traders make?

In the fast-paced world of finance, prop traders occupy a unique and dynamic role. Proprietary trading, as it is commonly known, involves individuals trading with their own capital to generate profits. These skilled traders operate within financial institutions or specialized trading firms, engaging in various markets and instruments. While the earnings of prop traders can vary based on numerous factors, it is widely recognized that prop trading has the potential to be highly lucrative. However, the pursuit of profit also comes with inherent risks. In this article, the experts at TU will delve into the world of prop trading and explore the factors that influence the earnings of prop traders, shedding light on this intriguing and often financially rewarding profession.

Is prop trading a good career?

Prop trading offers several advantages that make it an appealing career option for aspiring traders. Here are some key points to consider:

• Lower risk: Proprietary trading provides the opportunity to trade with the firm's capital rather than risking personal funds. This can help mitigate individual risk and protect personal finances

• More purchasing power and more advanced strategies: Prop traders often have access to larger trading capital, enabling them to take larger positions in the market. This increased purchasing power allows for the implementation of more sophisticated trading strategies that can potentially yield higher returns

• Good prospects for a full-time career: Prop trading can provide a viable path to a full-time career in the financial industry. Successful prop traders who consistently generate profits may have the opportunity to advance within the firm or even start their own trading businesses

• More favorable trading costs: Proprietary trading firms often have established relationships with brokers, which can result in lower trading costs, such as reduced commission fees and access to competitive spreads. These cost advantages can contribute to improved profitability for prop traders

• Access to professional tools and platforms: Proprietary trading firms typically provide traders with access to cutting-edge trading tools, advanced software, and robust trading platforms. These resources can enhance trading efficiency, provide real-time market data, and offer sophisticated analytical capabilities

It's important to note that while prop trading can offer numerous benefits, it also comes with its own set of challenges. Traders must be skilled, disciplined, and capable of managing risk effectively. The financial markets can be volatile and unpredictable, requiring continuous learning, adaptability, and a solid understanding of market dynamics.

Is prop trading safe?

Prop trading can be an attractive option for traders who lack the capital to trade on their own, but it's essential to be cautious. The risks can be significant, and not all prop trading firms operate on the same ethical and professional standards. Let's break down some critical factors to consider for a safer prop trading experience.

Firm reputation

Start by investigating the firm's reputation. Look at the firm's track record, history, and what other traders say about it. Online forums, reviews, and industry publications can provide useful insights. A solid reputation generally indicates that the firm has proven reliability and integrity.

Profit-sharing

Pay close attention to the profit-sharing agreement. A reputable firm will offer a fair and transparent profit-sharing scheme. Make sure you understand how the profits (and losses) get divided between you and the firm. Clarify all the terms before committing.

Fees and costs

Trading isn't free. Assess the fees and other associated costs like software fees and evaluation account fees. A firm with exorbitant fees can eat into your profits, making your trading endeavor less rewarding. Compare rates among different firms to find one that offers competitive pricing.

Prefer companies with direct trading

Many proprietary trading companies offer virtual trading accounts without any real financial risks for a prop firm. However, they do not benefit from a trader's success in these virtual accounts. It's essential to ensure that traders transition to real trading accounts after qualification to confirm the company's genuine interest in their success. This guarantees that the company has a stake in your success.

Transparency

Last but not least, transparency is crucial. The firm should be upfront about its operations, profit-sharing, and risk management practices. Clear and transparent communication enables you to make well-informed decisions and sets the stage for a mutually beneficial relationship.

How much do prop traders make?

According to data from Zippia, the average salary for a proprietary trader in the United States is approximately $100,000 per year, with an average hourly rate of around $48. However, it's important to note that salaries can vary based on several factors. Here are some key factors that influence a prop trader's salary:

• Location: The geographic location plays a significant role in determining a proprietary trader's earning potential. Cities such as New York, New Hampshire, Rhode Island, Nevada, and Delaware tend to offer higher salaries for prop traders compared to other regions. For instance, the average salary for prop traders in New York is around $126,000, while in New Hampshire and Rhode Island, it is approximately $124,000

• Education: The level of education attained by a prop trader can impact their salary. Those with advanced degrees or certifications in finance, economics, or related fields may have an advantage in securing higher-paying positions within prop trading firms. Continued education and professional development can also enhance a trader's knowledge and skills, potentially leading to increased earnings

• Experience:

  The general hierarchy in prop trading goes like this:

  • Clerk or assistant trader
    At the entry level, you have the "Clerk" or "Assistant Trader." People in this role usually handle administrative tasks like record-keeping, trade reconciliation, and data entry. This position offers a way to get a foot in the door, learn basic trading operations, and absorb the fast-paced environment of a trading floor. While not directly involved in making trading decisions, clerks gain exposure to strategies and trading techniques.

  • Junior trader
    Most people enter prop trading as Junior Traders, often right out of undergrad. Here, you'll be more involved in the trading process, but under the guidance of more experienced traders. You'll likely start off with smaller positions and lower risk limits. Junior traders spend their time honing skills, understanding market nuances, and proving their ability to make profitable trades. Successful performance could mean quicker promotions.

  • Senior trader
    As a Senior Trader, you've earned greater responsibilities and, consequently, higher profit targets. Senior traders often get the autonomy to make trading decisions and may even lead a team of junior traders. The stakes are higher, but so are the rewards. Senior Traders often have a say in strategy development and may get a bigger slice of the profit pie.

  • Partner
    Reaching the level of Partner is the pinnacle of a prop trading career. Partners typically have a stake in the firm and play a vital role in its strategic direction. Not only do they participate actively in high-level trading but they also make decisions that affect the entire firm. This can include capital allocation, risk management policies, and business development strategies.

  • Company and Firm Size:
    Well-established firms with significant capital resources may offer higher salaries and additional benefits to attract and retain top talent. For example, according to the research, the D. E. Shaw group is known for having one of the highest average salaries for proprietary traders

Best Forex prop firms in 2025

Experts have identified the following to be the Best Forex prop firms in 2025:

1

9.4/10

Go to broker

Your capital is at risk.
Your capital is at risk.

Minimum deposit:

$48

Review

Hola Prime is a trading company regulated by the Financial Services Commission (FSC) of Mauritius under license GB24203729 and has offices in six countries. The company was founded in 2024 and has evolved from a private community of professional traders that has been active since 2012. Hola Prime offers 1- and 2-stage challenges with account sizes up to $300,000, as well as direct funding options up to $100,000 that do not require a trading assessment. Traders can access up to $500,000 in capital with the support of a scaling plan that allows account growth up to $4 million. Hola PrimeThe company's services are available in more than 175 countries, including the United States.

Pros/Cons

•Wide choice of account types, including non-valuation models;

•Profit sharing up to 90-95% in favor of the trader;

•Access to scaling up to $4 million if performance criteria are met;

•No commissions on some assets (cryptocurrencies and indices) and spreads from 0.1 pips.

•The use of EAs (EAs) is prohibited on direct funded accounts;

•Not all account types support trading on news or holding positions on weekends.

STUDY REVIEW

2

9.2/10

Go to broker

Your capital is at risk.
Your capital is at risk.

Minimum deposit:

Package buy - $119

Review

SabioTrade is a proprietary (prop) trading company founded in 2021 in Dublin, Ireland. After completing a evaluation, the clients of the company receive access to $20,000 - $200,000 in funded accounts, with the profit split of up to 90%. A 7-day trial period. SabioTrade clients trade CFDs on currency pairs, commodities, indices, stocks, cryptocurrencies and ETFs on the platforms of the multi-regulated broker with leverage ranging to1:30, depending on the asset. Funding programs are available in countries not included in the OFAC sanctions list.

Pros/Cons

•Funding up to $200,000 upon passing the evaluation;

•The minimum Package buy is $119;

•All strategies are allowed, including trading on news events;

•One-time fee for using the evaluation account and a refund after the trader receives funding;

•The profit split is up to 90%;

•The maximum drawdown level is dynamic, not fixed;

•Coupons are available to reduce the one-time contribution.

•Each trader has only one attempt to pass the evaluation stage;

•Strict requirements for the daily loss limit which is no more than 3% of the account balance.

STUDY REVIEW

3

9.1/10

Go to broker

Your capital is at risk.
Your capital is at risk.

Minimum deposit:

$79

Review

Instant Funding is a proprietary trading company based in the United Kingdom that has been operating since 2021. It serves traders in more than 180 countries, including the United States. Trading instruments available include major and minor currency pairs, metals, commodities, indices and cryptocurrencies. Instant Funding offers One-Phase and Two-Phase assessment programs to obtain funded accounts ranging from $10,000 to $200,000, as well as instant funding from $1,250 to $80,000. The maximum allocation per operator after scaling can reach $2.5 million for One-Phase and Two-Phase challenges and $3.84 million for instant funded accounts.

Pros/Cons

•Single and two-phase challenges, as well as an instant funding program.

•Possibility to choose between a Raw Spread account or a commission-free account.

•High profit participation rate: 80% (base) or 90% (scalable accounts).

•Leverage up to 1:100 for major currency pairs.

•Algorithmic trading is not allowed.

•Higher one-time fee of between $79 and $89, depending on the challenge, compared to competitors.

STUDY REVIEW

FAQs

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Team that worked on the article

Chinmay Soni

Developmental English Editor

Chinmay Soni is a financial analyst with more than 5 years of experience in working with stocks, Forex, derivatives, and other assets. As a founder of a boutique research firm and an active researcher, he covers various industries and fields, providing insights backed by statistical data. He is also an educator in the field of finance and technology.

As an author for Traders Union, he contributes his deep analytical insights on various topics, taking into account various aspects.

Learn about our editorial policies

Dr. BJ Johnson

Developmental English Editor

Dr. BJ Johnson is a PhD in English Language and an editor with over 15 years of experience. He earned his degree in English Language in the U.S and the UK. In 2020, Dr. Johnson joined the Traders Union team. Since then, he has created over 100 exclusive articles and edited over 300 articles of other authors.

Mirjan Hipolito

Cryptocurrency and stock expert

Mirjan Hipolito is a journalist and news editor at Traders Union. She is an expert crypto writer with five years of experience in the financial markets. Her specialties are daily market news, price predictions, and Initial Coin Offerings (ICO).

Glossary for novice traders

Yield

Yield refers to the earnings or income derived from an investment. It mirrors the returns generated by owning assets such as stocks, bonds, or other financial instruments.

Investor

An investor is an individual, who invests money in an asset with the expectation that its value would appreciate in the future. The asset can be anything, including a bond, debenture, mutual fund, equity, gold, silver, exchange-traded funds (ETFs), and real-estate property.

Leverage

Forex leverage is a tool enabling traders to control larger positions with a relatively small amount of capital, amplifying potential profits and losses based on the chosen leverage ratio.

CFD

CFD is a contract between an investor/trader and seller that demonstrates that the trader will need to pay the price difference between the current value of the asset and its value at the time of contract to the seller.

Algorithmic trading

Algorithmic trading is an advanced method that relies on advanced coding and formulas based on a mathematical model. However, compared to traditional trading methods, the process differs by being automated.