Why Should You Compare Prop Firms?

Prop trading, which is short for proprietary trading, is a type of trading arrangement where a trading firm provides you funding to trade with on the understanding that the profits will be shared between yourself and the prop firm. Since you are using clients funds, rather than your own capital when trading, prop trading allows yo to avoid putting your own capital at risk when trading.

Since prop firms provide you as a clients with the funds to trade with, their profitability is (almost) entirely reliant on your skills as a trader. For this reason, its in the interest of the prop firm to provide you with the right trading infrastructure (like platform and products), tools and support to better your chances of earning profits. The more profits you earn for yourself, the more you will earn for the prop firm.

All prop have different funding programs and since it is their funds you will trade with and they will bear the cost of any losses. For this reason prop firms provide you with different amounts of funding, have different evaluation programs to asses your suitability as a client, and varying risk management requirements in place to ensure losses of their capital are minimised.