How to pass a prop firm challenge

Before you buy: pick a challenge that fits you

Most failures are decided before the first trade. Pick a plan whose rules fit the way you trade:

• Do you hold trades for hours or overnight? Avoid intraday trailing drawdown and check that overnight holding is allowed.
• Few trades but big winners? Watch out for consistency rules: one big day can block passing or a payout.
• Do you trade news releases? Check the news rule, in the evaluation and on the funded account.

The quiz and the comparison filter on these for you.

Think in drawdown, not in target

At most firms the profit target has no deadline, while the drawdown can end the challenge in a day. Set your risk from the drawdown:

• Risk a small share of the drawdown per trade, for example 5 to 10%: on a $2,000 drawdown that's $100 to $200 per trade.
• Set your own daily loss limit below the firm's, and stop when you hit it.
• With a trailing drawdown, lock in early: while the limit follows your gains, every profit you give back shrinks your room.

The first week

• Days 1 and 2: small size. The aim is to check the platform, fees and fills, not to make money.
• Then: normal size, with a maximum number of trades per day set in advance.
• After a big winning day: trade smaller the next day. Overconfidence is where most challenges are lost.
• Close to the target: don't force it. A few more days cost less than a new challenge.

The rules people forget

• A minimum number of trading days before you pass.
• A minimum holding time, or a ban on micro-scalping.
• Positions to close before the weekend or by a set time.
• Size limits (number of contracts or lots).
• A consistency rule that sometimes applies only to the funded account.

Each plan page lists them, with a link to an explanation of each rule.

After you pass

The funded account often has different rules from the evaluation: a new drawdown, a buffer to build before the first payout, consistency, a number of winning days. Read them before you go back to your usual pace, and use the payout calculator to see when and how much you can withdraw.