How to Choose a Prop Firm: Complete Decision Framework
Choosing the wrong prop firm can cost you thousands in failed challenges and wasted time. This comprehensive guide gives you a proven framework to find your perfect match based on your trading style, experience, and goals.
Quick Start Guide
Target Audience
All Traders
Read Time
15 min
Outcome
Find Your Perfect Firm
Why Your Choice of Prop Firm Matters
There are 50+ prop trading firms in 2025, each with different rules, costs, platforms, and profit splits. Choosing the wrong one isn't just inconvenient—it can be expensive and demotivating.
Wrong Firm = Expensive Mistakes
- Rules don't match your trading style
- Multiple failed challenges ($300-$600 each)
- Wasted months with wrong platform
- Poor support when you need help
- Payout delays or hidden fees
Right Firm = Accelerated Success
- Rules align with your strategy
- Pass challenges on first or second attempt
- Comfortable platform and instruments
- Responsive support and fair treatment
- Fast, reliable payouts
This guide will walk you through 7 key factors to consider, show you how to match firms to your trading style, reveal red flags to avoid, and provide a step-by-step decision framework.
By the end, you'll know exactly which prop firm(s) to pursue first.
7 Key Factors to Evaluate Every Prop Firm
1. Evaluation Rules & Requirements
Profit targets, daily loss limits, max drawdown, minimum trading days
Key Considerations:
- Static vs trailing drawdown (static is easier)
- Profit target percentage (8-10% is standard)
- Daily loss limit (3-5% typical)
- Consistency rules (some firms require)
- Minimum/maximum trading days
2. Costs & Profit Splits
Challenge fees, monthly fees, and your share of profits
Key Considerations:
- Initial challenge cost ($100-$600)
- Monthly platform fees after funding
- Profit split percentage (70-90%)
- Scaling opportunities to higher splits
- Refundable vs non-refundable fees
3. Trading Platforms & Instruments
Available platforms and what you can trade
Key Considerations:
- Your preferred platform (NinjaTrader, TradingView, MT4/MT5, cTrader)
- Instrument variety (Forex, Crypto, Indices, Commodities)
- Number of instruments available
- Data feed quality and execution speed
- Mobile trading availability
4. Payout Terms & Speed
How and when you receive your trading profits
Key Considerations:
- Payout frequency (weekly, bi-weekly, monthly)
- First payout waiting period
- Minimum payout amounts
- Payment methods (bank transfer, crypto, etc.)
- Payout processing time
5. Scaling Plan
Path to managing larger accounts and higher splits
Key Considerations:
- Maximum account size available
- Scaling criteria and timeline
- Profit split increases with scaling
- Multiple account policies
- Consistency requirements for scaling
6. Company Reputation & Trust
Track record, reviews, and reliability
Key Considerations:
- Years in business (3+ preferred)
- Trustpilot rating (4.0+ ideal)
- Payout proof and testimonials
- Social media presence and transparency
- Customer support quality
7. Education & Support
Resources to help you succeed
Key Considerations:
- Trading education and webinars
- Community access (Discord, Telegram)
- Customer support availability
- Challenge reset policies
- Free trial or demo accounts
Quick Comparison: Best Firms by Category
Best for Beginners
Low cost ($127), simple rules, forgiving
Best for Forex
Industry leader, static drawdown, 80-90% split
Best for Futures
Futures specialist, 90% split, great platform
Best for Crypto
Excellent pairs, 24/7 trading, MetaTrader
Best Value
Low cost, good rules, educational focus
Best Scaling
Up to $2M, split increases to 90%
Fastest Payouts
Bi-weekly payouts, first after 14 days
Find Your Match: Recommendations by Trader Type
Complete Beginner
New to trading or prop firms
Recommended Firms:
Apex Trader Funding
$25k-$50k to startLow cost ($127), simple rules, forgiving drawdown
E8 Funding
$25k-$50k to startEducational focus, no minimum trading days
Tips for Success:
- Start with smaller account size ($25k-$50k)
- Choose static drawdown over trailing
- Look for firms with free retakes or resets
- Prioritize educational resources
Experienced Forex Trader
2+ years trading Forex profitably
Recommended Firms:
FTMO
$100k-$200kIndustry leader, 80-90% split, static drawdown
MyForexFunds
$100k+Fast payouts, good platform variety
Tips for Success:
- Target $100k+ accounts for meaningful income
- Look for 80%+ profit splits
- Check consistency rules carefully
- Consider multiple accounts for diversification
Futures Day Trader
Active in ES, NQ, CL, etc.
Recommended Firms:
TopStep
$50k-$150kFutures specialist, 90% split, excellent platform
Apex Trader Funding
$50k-$100kBudget-friendly, good futures selection
Tips for Success:
- Verify your preferred futures contracts are available
- Check commission structure
- Trailing drawdown is common - be prepared
- Look for firms with strong execution speed
Crypto Trader
Specializing in cryptocurrency markets
Recommended Firms:
FTMO
$100k+Excellent crypto pairs, MetaTrader support
Funded Trading Plus
$50k-$100kCrypto-friendly rules, 24/7 trading allowed
Tips for Success:
- Ensure 24/7 trading is allowed
- Check news trading policies (important for crypto)
- Verify which crypto pairs are available
- Look for firms with low weekend trading restrictions
Scalper
High-frequency, small profit targets
Recommended Firms:
Apex Trader Funding
$50k+No scalping restrictions, low cost
E8 Funding
$50k+Scalping-friendly, fast execution
Tips for Success:
- Verify no scalping restrictions
- Check commission/spread costs (adds up fast)
- Look for excellent execution speed
- Avoid firms with strict consistency rules
Swing Trader
Holding positions for days/weeks
Recommended Firms:
FTMO
$100k+No minimum trading days, overnight holding allowed
MyForexFunds
$100k+Flexible trading styles, good Forex pairs
Tips for Success:
- Check overnight and weekend holding policies
- Look for firms without minimum trading days
- Static drawdown is ideal
- Ensure low/no inactivity fees
Red Flags: Warning Signs to Avoid
Protect yourself from scams and poor firms
No Payout Proof
CriticalCompany provides no evidence of paying traders
Poor Trustpilot Reviews
HighConsistent complaints about payouts or rule changes
Vague Terms & Conditions
HighUnclear rules that can be interpreted multiple ways
Frequent Rule Changes
MediumRules change without notice or grandfather clauses
Unrealistic Promises
CriticalGuaranteed profits, "everyone passes" claims
No Customer Support
HighImpossible to reach support or get questions answered
Hidden Fees
MediumUndisclosed monthly fees, data fees, or platform costs
New Company (<1 Year)
MediumNo track record, unproven business model
Pro Tip: If you spot 2+ red flags, move on. There are plenty of reputable firms—don't risk your money on questionable ones.
7-Step Decision Framework
Define Your Trading Style
Identify your preferred markets, timeframe, and strategy
Ask Yourself:
- What do I want to trade? (Forex, Futures, Crypto)
- What platform do I use? (MT4/MT5, NinjaTrader, TradingView)
- What's my trading style? (Scalping, Day Trading, Swing)
- How much time can I dedicate daily?
Set Your Budget
Determine how much you can invest in challenges
Ask Yourself:
- How much can I afford to risk on challenges?
- Can I afford monthly platform fees?
- Do I need refundable fees?
- What account size gives me meaningful income?
Research 3-5 Firms
Narrow down options that match your criteria
Ask Yourself:
- Which firms support my preferred instruments?
- What are their evaluation rules?
- What profit split do they offer?
- What's their reputation and track record?
Compare Rules Side-by-Side
Use comparison tools to analyze key differences
Ask Yourself:
- Static or trailing drawdown?
- What are daily loss limits?
- Are there consistency rules?
- What's the profit target?
Read Reviews & Testimonials
Verify reputation with real trader experiences
Ask Yourself:
- What do Trustpilot reviews say?
- Are there payout proofs?
- What do traders complain about?
- Is support responsive?
Start Small
Begin with one firm and smaller account size
Ask Yourself:
- Should I start with $25k, $50k, or $100k?
- Can I afford multiple attempts if needed?
- Does this firm offer free retakes?
- What's my plan if I fail?
Evaluate & Scale
After first success, consider diversification
Ask Yourself:
- How is my experience with this firm?
- Should I scale up with same firm?
- Should I diversify to other firms?
- Can I manage multiple accounts?
Frequently Asked Questions
Should I choose a cheap or expensive prop firm?
Price isn't the only factor. Cheap firms ($100-$200) are great for beginners or testing strategies. Expensive firms ($300-$600) often have better rules (like static drawdown) and higher profit splits. Consider your budget and experience level. If you're new, start cheap. If experienced, invest in better rules.
Can I trade with multiple prop firms at once?
Yes! This is actually recommended for risk diversification. Most successful prop traders run 3-10 accounts across different firms. Start with one, get funded, then add more. This spreads risk and increases income potential. Just ensure you can manage the time commitment.
What's more important: profit split or rules?
Rules are more important. A 90% split means nothing if you can't pass the challenge. Prioritize rules that match your trading style (static vs trailing drawdown, daily loss limits, etc.). Once you find firms you can pass consistently, then optimize for profit split.
Should I avoid new prop firms?
Not necessarily, but be cautious. New firms (< 1 year) have no track record. Look for payout proofs, transparent owners, and active community. Start with small account if testing a new firm. Established firms (3+ years) are safer but may have stricter rules.
How many prop firms should I apply to?
Start with ONE. Master their rules, pass the challenge, get funded. Then consider adding 1-2 more. Spreading yourself too thin across multiple evaluations simultaneously usually leads to failures. Sequential approach is more successful.
What if I fail my first challenge?
Most traders fail their first attempt (60-70%). Analyze what went wrong: risk management? psychology? rule violations? Take a 2-week break, study your mistakes, then try again with same or different firm. Budget for 2-3 attempts per firm.
Do I need a prop firm or can I trade my own capital?
Prop firms make sense if: (1) You have limited capital (<$25k), (2) You're consistently profitable but need more size, (3) You want to separate personal finances from trading, (4) You want access to better platforms/data. If you have $100k+ and consistent profits, self-funding might be better.
What account size should I start with?
Beginners: $25k-$50k. This keeps costs low ($100-$200) and pressure manageable. Experienced: $100k+. This provides meaningful income potential. Calculate: with 10% monthly profit and 80% split, a $100k account = $8k/month income. A $25k account = $2k/month.
Ready to Choose Your Perfect Prop Firm?
Use our comparison tools to evaluate firms side-by-side and find your best match in minutes.