Prop firm FAQ: common questions, short answers

General answers, valid for the pattern described in our guides. None describes a particular firm: each firm's terms prevail.

What is a prop firm?

A proprietary trading firm. In the challenge model, it sells access to an evaluation and, if the trader passes it, to a so-called "funded" account with profit sharing. See how a prop firm works.

Do you have to pay to take a challenge?

In the model described in our guides, yes: a fee gives access to the evaluation. The amount and any additional fees are in the firm's terms.

Are challenge fees refunded?

It depends on each firm's terms: they state whether, in which cases and when a refund exists. If nothing is stated, do not assume it.

Can you lose more than the fee of the first challenge?

Each new attempt (reset) may cost a new fee, and terms may provide for activation fees or subscriptions. The total depends on the number of attempts. See how to choose.

Does a funded account use real money?

Not necessarily. "Funded" names a status; the nature of the account (simulated or live) is stated, or not, in the terms. See simulated or live account.

What is drawdown?

The maximum allowed drop of the account before it is closed. It can be measured on balance or on equity. See the glossary.

What is the difference between static and trailing drawdown?

The threshold of a static drawdown stays fixed. The threshold of a trailing drawdown rises with the highest level reached by the account. See rules explained.

Is a payout guaranteed?

No. A payout depends on the firm's terms (minimum profit, trading days, rules respected, identity check) and on its review. See prop firm risks.

What is the consistency rule?

A rule that limits the share a day or a trade may represent in total profit. Formula, period and penalty are defined by the firm. See the glossary.

Why do rules differ from one firm to another?

Each firm publishes its own terms, and the terms used are not defined the same way everywhere. Compare the written terms, not the names of the rules.

How do you compare prop firms?

On verifiable criteria: drawdown type, real cost, payout rules, transparency, rule history, support, payment, reviews. See the checklist and the prop firm list.

What does "verified review" mean on this site?

An administrator has validated a proof (purchase receipt, payout screenshot) sent by the review's author. A verified review weighs more in the community score. Details in the methodology.

Can a prop firm close?

Yes, a firm is a business and can stop operating or change its offer. Each firm's status (active, closed, unverified) is shown on its page in the list.

Does this site give investment advice?

No. The content is informational: no advice, no recommendation of a firm or strategy, no promise of gain. See the risk warning.