CFD Prop Firm – Trade and Earn (2024)

FAQs

How do you pass the prop firm challenge? ›

The simple answer to this question is that yes, it's possible to make money with CFD trading. The long and more realistic answer is that you first need to hone your trading skills and have a lot of discipline, practice, and patience to do well in the market.

However, there are a few real-life examples that can give you an idea of the potential earning power of CFD trading. A trader with a $10,000 account who consistently achieves a 10% return on their trades would earn an average of $1,000 per month.

Yes. Prop firms do pay out, but the amount of money that a trader can make will depend on their performance and the terms of their agreement with the firm.

Studies have shown that around 4 out of 10 people pass the first stages of any Prop Firm Challenge, and 2 out of the 4 make it through to get a Funded Account. But only 1 person ends up getting paid.

The article from Lux Trading Firm provides slightly different results. According to it, 4% of traders, on average, pass prop firm challenges. But only 1% of traders kept their funded accounts for a reasonable amount of time.

While a popular and often rewarding market, people may consider CFD trading difficult for valid reasons. It's fraught with volatility and can lead to substantial losses if not properly managed. It also requires a combination of financial knowledge, technical skills, risk tolerance, and a robust trading psychology.

Part of the reason why a CFD is illegal in the U.S. is that it is an over-the-counter (OTC) product, which means that it doesn't pass through regulated exchanges. Using leverage also allows for the possibility of larger losses and is a concern for regulators.

CFD Traders Reducing risk exposure

By failing to adopt certain risk management techniques and simply opening trades without protecting their trades with take-profit and stop-loss orders, they risk losing all their trading funds.

It's possible to make money trading CFDs with experience and a thorough understanding of how the financial markets work. But, it's well known that around 75% of retail traders (private investors) lose money when trading CFDs.

Is CFD trading good for beginners? ›

CFD trading offers exciting opportunities but comes with its own set of risks, especially for beginners. By understanding the basics of how CFDs work, choosing the right broker, using leverage wisely, and developing a coherent and tested trading strategy, beginners can set themselves up for success.

The $25k requirement for day trading is a rule set by FINRA. It's designed to protect investors from the risks of day trading. By requiring a minimum equity of $25k, FINRA ensures that investors have enough capital to absorb potential losses. But remember, even with $25k, day trading is still a high-risk activity.

Surge Trader is a leading high-paying prop trading firm. It provides traders with funded accounts of up to $1 million. Furthermore, Surge Trader offers a substantial 75-90% profit share. Their simplified one-step screening procedure accelerates funding.

Prop Firm Trader Salary

The salary of a prop trader can vary greatly depending on several factors such as experience, performance, and the size of the firm. On average, a junior prop trader can expect to earn anywhere between $50,000 to $100,000 per year, while a senior trader can make upwards of $500,000 annually.

Statistics on Average Trader Payouts

Profit Split: The average prop firm will offer a 80-20 profit split once you become a funded trader. TFT, on the other hand, gives up to a 90% split, — even as high as 95% in some promotions — the highest in the industry.

For most funded trading accounts, it takes around four to five months to pass the screening process or prop firm trading challenge, before funding will be allocated to a trader. However, some prop firm challenges can be passed in a much shorter time, in as little as two days, though this involves using increased risk.

Maintain composure and focus, even during challenging times. Employ techniques like deep breathing to stay composed. Emotional decisions can lead to unfavourable trades. In summary, succeeding in a trading prop firm challenge demands planning, risk management, adaptability, continuous learning, and emotional control.

By far the biggest incentive for passing a prop firm challenge is being able to trade with capital up to $1 million in some cases. This means you're able to massively increase your potential earnings each month without having to risk a higher percentage per trade.

You need to have a solid understanding of how to manage risk in order to succeed. This involves setting stop losses, using leverage appropriately, and having a solid understanding of market trends. Keep in mind that the goal is not to make a quick profit, but to sustainably grow your account over time.