What to Look for When Choosing a Prop Firm

With dozens of prop trading firms emerging in the forex and futures space, finding the right one can be overwhelming. Whether you’re aiming to pass an evaluation or looking to scale a funded account, selecting the right prop firm is critical to your long-term success. Here’s a quick guide on what matters most when choosing a prop firm in 2024.

Key Factors to Consider

• Pricing & Challenge Fees

  Understand the upfront cost of evaluations and whether the fee is refundable. Some firms offer lower entry costs but tighter rules.

• Reputation & Trustworthiness

  Check Trustpilot reviews, trader feedback, and their social presence. A firm with a good track record is less likely to shut down or change rules overnight.

• Payout Structure

  Look at the profit split (typically 80%–90%) and how often payouts are made (weekly, bi-weekly, or monthly). Also, confirm if the first payout comes quickly or after a waiting period.

• Maximum Drawdown Rules

  Know the daily and total loss limits. These are critical—some firms have trailing drawdown, which can be restrictive if not managed well.

• News Trading Policy

  Can you trade during high-impact news events? Some firms ban or limit news trading which may affect scalpers and news-based strategies.

• EA/Algo/Automated Trading Support

  If you’re using bots, ensure the firm allows Expert Advisors (EAs) or algorithmic trading. Some firms prohibit this entirely.

• Copy Trading Allowed?

  If you’re using a trade copier to manage multiple accounts, verify that copy trading is permitted. Some prop firms actively ban mirrored strategies.

• Scaling Plan

  Look for firms that offer scaling benefits—where consistent performance unlocks higher capital over time.

• Platform Compatibility

  Ensure the firm supports your preferred trading platform (MT4, MT5, cTrader, NinjaTrader, etc.), especially if you’re using third-party tools.

• Slippage & Execution Speed

  Execution quality matters. Ask or research how the firm handles order flow and whether there’s noticeable slippage during volatile conditions.