Do prop firms genuinely care about finding good traders? Do they genuinely want to fund them and help them succeed? Let’s go back to the point about the demo account because let’s say that you’re funded with a $200,000 account. Fantastic, you know that you’re trading a demo account that may or may not be linked to a live account, you don’t know if it is. All we know about is you now have a $200,000 trading account and the prop firm that you’re trading with is watching to see if you’re consistent with that. As now they can see your performance. Now they are going to link this up to a live trading account. I don’t know if that’s linked to a $200,000 a million or whatever.
Who knows but if you’re genuinely a good trader you might be earning much less than you deserve. These prop firms would be copying trades from all these traders and pooling them into 1 account. So last year as some of you may already know a member of my team Sam passed the FTMO challenge so I got to see firsthand how it works when someone gets funded. But the most important part he said something to me which I haven’t really given enough thought to change my opinion. He said, as long as you can genuinely trade well and end up losing, but just as long as they do pay the money that you expect them too, who really cares how the system is set up. Most traders will burn the challenge account and fail numerous times in the hope they will get funded. This is exactly what prop firms want you to do. On the other hand it’s simply a business model. If you’re making say 10,000 pounds a month from them but they’re making 30,000 pounds a month from you, does it actually matter? It’s still money that you wouldn’t have had without that service and in no way devalues what you can do or what you can do in the future. So it’s only ego that makes you feel cheated.
In reality you’re still get paid and of course maybe one day the company has some sort of issue and can’t pay the money out. Maybe something changed in the future regulation stop them from doing it. That’s a risk that you take but ultimately all your actually risking is the initial challenge fee for you would you get paid back to you if you do make a return on the challenge. It’s not your money that’s at risk. Same thing from this point if you did start to change my opinion I never thought to look at other positive aspects of using a proper funded trading account. The first is that it genuinely gives a chance to people who don’t have much money to be able to make a decent living. These challenges also encourage more people to trade with proper risk management because they don’t need to take excessive risks on a small account anymore. They also will be able to earn a decent amount of money so this would be like a breath of fresh air for people who are learning to trade but worry it will work without ever be able to make money from it because of their current financial situation.
Also with FTMO most specifically they have a two options for the type of trading account that you can trade with. Makes sense so actually with all of this in mind I have to say that some of these companies will change rules all the time. I’m happy to admit that I was wrong before about the whole prop firms. I think if you can genuinely trade consistently and you’ve seen that from your results over time, you can do it this as good option to apply for one of these challenge funded account. If you can’t trade consistently or if you’ve not done it before but you just look at the challenge as something that you might pass, don’t bother applying because even if you pass the challenge, what you will end up doing is losing the account once you’ve got funded anyway. Alternatively if you’re a trader and need capital to trade with, IFA is the perfect opportunity.