The 5 Best Prop Trading Firms in 2022 | Reviewed & Ranked
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Proprietary trading is one of the fastest ways to financial independence. Today, it is more accessible than ever.
We reviewed and ranked the best prop trading firms out there based on:
- Profit splits
- Evaluation times
- Initial investment
- Supported strategies
- Trading platforms
- Withdrawal times
- Customer support
Find below the best platform for your trading style and starting capital.
The Best Prop Traders in 2022
City Traders Imperium is a dynamic trading community built for success. Powerful tools and proprietary strategies combined with insightful training that focuses on discipline and mental fortitude will help you hone your trading skills.
- •Up to $2M in funding
- •Proprietary trading strategies
- •Extended, personalized training
FTMO focuses on dedication and goal-oriented challenges. Its generous profit split, variety of tradable assets, and trading partners make it ideal for a broad range of day traders who are ready to push and grow with one of the most reputable prop trading firms. Are you ready?
- •Up to $2M in funding
- •90:10 profit split
- •A handful of insightful apps
Fidelcrest offers a massive profit split - up to 90:10 for aggressive traders - and 1:100 leverage to attract some of the best prop traders around. Over 6,000 traders thrive in its competitive environment and numerous assets.
- •Up to $1M in funding
- •1:100 leverage
- •Numerous assets
Aggressive scaling up and reasonable limits make T4T Capital an excellent entry point for aspiring Forex traders. A risk-free initial evaluation, extensive trading, and specialized FX trading tools will equip you for success.
- •Up to $1M in funding
- •80:20 split
- •Specialized Forex training programs
E8 Funding puts into your hands powerful tools for active trading. Its intuitive mobile app, generous profit split, and fantastic leverage allow for constant monitoring, strategy tweaks, power moves, and quick gains.
- •Up to $1M funding
- •80:20 split
- •1:100 leverage
How We Ranked the Best Prop Trading Firms in 2022
Our ranking is based on in-depth research that weighed in several key factors.
1. The Profit Split
The weight of profit split played a crucial role when ranking the top prop trading firms. A firm’s profit split tells a lot about how they operate and how much they value their traders.
In general, the higher the profit split, the more favorable the firm is to its traders. This is because the firm is taking on more risk by giving a larger portion of the profits to its traders. As a result, the traders are more likely to be profitable and stay with the firm.
A lower profit split, on the other hand, can lead to a more competitive environment and less profit potential for the traders.
When looking at the profit split, it’s important to consider the size of the firm.
A smaller firm may have a higher profit split than a larger firm, simply because they can’t afford to be as generous.
2. Value
First, we considered the initial investment required. Then, we evaluated the quality of the firm’s service interface and mobile app. Finally, we take into account support and training offerings to determine the overall value of the firm.
The initial investment is an important factor when ranking any investment opportunity. It’s important to know that you’re getting your money’s worth when you sign up with a firm. That’s why we considered the amount of capital required to get started. Trading firms with a single payment are ranked higher than those with monthly fees.
The quality of the interface is also important. A good interface makes it easy for traders to execute their strategies and manage their portfolios. We looked at the features of each firm’s platform to determine how easy it is to use.
The quality of a firm’s mobile app is also important. A good mobile app makes trading on the go easy and convenient.
3. Risk Factors
When it comes to prop trading, there are a number of risk factors to consider. First and foremost, you need to be aware of the potential for loss. Even the best traders lose money.
Your broker must have adequate stop-loss mechanisms in place. If they don’t have adequate ways to stop losses spiraling out of control, you could find yourself losing a lot of money very quickly.
Finally, you need to make sure that you understand the firm’s risk management policies. Some firms are more conservative than others, and you need to be comfortable with the level of risk that you’re taking on.
There are plenty of firms out there that offer different levels of risk, so you should be able to find one that meets your needs.
We ranked higher prop traders with clear policies and stop-loss mechanisms.
4. Trading Assets
Forex, fortunes, crypto, and more assets are available for trading, but should you try to grasp everything at once?
The short and definitive answer is no.
Focus and excel in one niche before considering conquering others, as each and every asset has its own intricacies.
Expertise in one field will help you discern which prop trader is a better match for your preferences and skills as some of them impose restrictions within the classes of assets they trade.
5. Growth
As a prop trader, you’re always looking for ways to grow your money pot. After all, the more money you have to trade with, the more potential profits you can make.
The leading prop trading firms offer performance-based payouts. This is one of the very reasons why these firms are so popular with experienced traders.
If you’re looking to take your trading to the next level, then open an account with a firm that offers performance-based payouts in a structured and meaningful way. Many proprietary trading companies flash the largest pots they offer, but we check carefully how a trader can actually get there.
6. Trading Strategies
There are many different types of trading strategies and parameters that are allowed in prop trading firms. All of them are put in place to balance the necessary risk-taking with the long-term financial security of the firm itself.
Some traders specialize in short-term, day trading strategies, while others may focus on longer-term investments.
Many prop trading firms allow their traders to use a variety of technical indicators to make their investment decisions. In addition, many prop trading firms have very specific rules about the maximum amount of leverage that traders are allowed to use.
This helps to ensure that traders do not take on too much risk and that the firm’s capital is protected.
Finally, prop trading firms also have limits on the types of securities that traders are allowed to buy and sell. This helps to ensure that the firm’s portfolio is diversified and that it is not overly exposed to any one type of security.
We gave firms with fewer restrictions higher ranking and awarded bonus points to those with clear, transparent explanations of the rules of engagement.
7. Onboarding and Training
Training is a huge part of becoming a proficient and profitable trader. The best proprietary trading firms provide many different types of training, from courses to calls to knowledge bases. Each type of training has its own benefits and can play a huge role in your success as a prop trader.
Even if you are an experienced trader don’t underestimate the value of quality onboarding. The modern trading platforms constantly evolve. New developments in the search for the elusive edge and new ways of making the most out of the ocean of data can give you a competitive advantage.
We put great value in professional onboarding and quality training materials, as these factors equip new traders with the tools to succeed and polish the weapons of veterans.
8. Support
This one is straightforward. Any online service must be accessible to its customers.
We checked how quickly and helpfully the support teams of the leading prop trading platforms respond.
What Makes Proprietary Trading Firms Special?
Proprietary trading firms are usually limited partnerships that engage in transactions on behalf of their clients. In other words, these firms use the money of their clients to trade financial instruments such as stocks, bonds, and commodities.
The best prop trading firms offer several advantages to their clients.
Biggest Benefits
- Access to capital Proprietary trading firms have access to large amounts of capital, which they can use to trade on behalf of their clients.
- Expertise Proprietary trading firms employ experienced traders who know how to make money in the markets.
- Leverage Proprietary trading firms can provide their clients with leverage, which allows them to trade with more money than they have in their accounts.
Types of Prop Trading Firms
There are a few different types of prop firms, based on the assets they specialize in.
Some focus on trading stocks, some on futures and forex, and others on options. There are also firms that focus on specific sectors or regions. And finally, there are firms that trade a variety of asset classes.
Each type of firm has its own strengths and weaknesses. For example, stock trading firms tend to be very good at research and analysis. They also have access to a lot of information and data. However, they may not be as good at trading other asset classes.
Futures trading firms, on the other hand, tend to be very good at active trading. They often have better systems and infrastructure in place. And they usually have a deep understanding of the markets. However, they may not be as good at research and analysis.
Options trading firms are often very good at both trading and research. They have access to a lot of data and information. And they often have sophisticated systems in place. However, they may not be as good at sector or regional analysis.
Boutique trading firms are small, independent firms that trade financial securities on behalf of their clients. These firms are typically not affiliated with large banks or other financial institutions, and they often have a more personal approach to client service.
Usually, they offer a higher level of customer service than larger firms. They may be able to provide more personalized advice and support, and they may be more responsive to customer needs. In addition, boutique trading firms may offer lower fees than larger firms.
Finally, there are firms that trade a variety of asset classes. These firms often have the best of all worlds. They have access to a lot of data and information. They have sophisticated systems in place. And they often have a deep understanding of the markets.
This being said, there are plenty of futures prop trading firms on the list above, but also some of the best forex proprietary traders. Do your due diligence before applying to discover the best prop trader for the asset class you like.
How to Start Trading With Prop Trading Firms?
Many people think that professional traders have some magical formula or advantage that allows them to make a killing in the markets. The truth is, there is no magic formula.
What professional traders do have is access to data amassed by trading platforms. They can read this data to make better-informed decisions and execute trades faster.
The best part is that even if you have no prior experience in dealing with markets, there are proprietary trading firms for beginners. They are a touch more restrictive, but provide excellent training and are the perfect gateway into the world of online trading.
1. Understand the Basics of How Trading Works
Before you start trading with real money, you should have a good understanding of how the markets work. You don’t need to be an expert, but a good grasp of things like price action, charts, indicators, how capital gain and loss happen is a must. This will give you a foundation to build on and will help you make better trading decisions.
You can read books, take courses, and even spend time observing the markets.
Virtually all of the top prop trading firms provide education and training. They want their traders to be successful, and they know that a good education is the key to success.
You should take full advantage of such resources.
Take the time to develop as deep an understanding as you can about the intricate market dynamics before you start trading.
Once you have a good understanding of how the markets work, you will be in a good position to learn quickly from experience.
2. How to Trade With Prop Firms
The next step is to open a trading account with the firm of choice. Compare the best proprietary trading firms from the list above, shortlist two or three, and get in touch with them to acquire a better idea of what they are about.
When you choose the right prop trader for you, be that a forex prop firm or a futures specialist, register there.
Once you have an account, you’ll be able to access the firm’s trading platform and data.
Then you can start your training, as every platform has its peculiarities and every prop trading company has its guidelines.
After you are comfortable with the tools at your disposal, you need to develop your trading strategy.
This will be your bread and butter as a professional trader.
The Pros and Cons of Prop Firms
Here are the main advantages and disadvantages to consider when trading with proprietary firms:
The pros of prop firms include:
- Training and education in trading
- Access to large capital with minimal investment
- Exposure to financial markets with minimal personal financial risk
- A wide range of products to trade
- More personalized service to clients
- Potential for high returns
- Structure and discipline
The cons of prop firms include:
- A high level of commitment can be a barrier for some investors
- Steep learning curve
- Lack of regulation compared to traditional brokerages
- Higher risks and potential for losses
- May have less liquidity than public markets
Wrap Up
There you have it—a comparative list of the best proprietary firms, a brief guide into the field, and answers to some of the most common questions.
Check out our detailed comparison above and choose the best trading platform for you.
Unaware that life beyond the internet exists, Nick is poking servers and control panels, playing with WordPress add-ons, and helping people get the hosting that suits them.