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Day traders have some difficult decisions to make, including whether to pursue funded trader programs or to trade with a live account. As a funded trader, you can trade with the firm’s capital instead of your own money. Proprietary trading firms won’t just hand over the funds; instead, they’ll test the mettle of traders first to determine whether they possess the skill set necessary to succeed.
When you trade live, on the other hand, you are on your own to fund the account with your own capital, while shouldering all the risks. Although, you are also entitled to the total profits, minus any fees.
Trading with companies like EdgeClear allows you to have the best of both worlds - trading in a simulated environment until you’re ready to apply your skills to a live environment.
Some of the top funded programs available to futures traders in the market today include:
Topstep: Topstep is a trading platform where futures traders can hone their skills in a simulated environment. Trading Combine, the firm’s simulated platform, is where traders learn and are evaluated in a practice environment. If they meet TopStep’s standards, traders are then given an opportunity to put their skills to use with funded accounts.
Slightly more than 25% of traders who participated in the simulation passed the firm’s evaluation, proving they can manage risk and achieve profitability in the first seven months of 2023, thereby achieving funded status. Topstep allows traders to pay themselves four times a month.
Apex Trader Funding: Apex Trader Funding is another futures trading platform that offers funding programs to qualifying futures traders. Apex, which welcomes novice as well as sophisticated traders, has a qualifying program in which traders are evaluated before they gain access to the firm’s funding. Apex also offers traders access to leverage, which is akin to amplifying one’s bet and raising the stakes for potential profits or losses.
There are several phases to Apex’s evaluation program, beginning with an initial evaluation in a simulated environment with real-time data. Once successful, traders are offered an opportunity to trade in a live environment with an account funded by Apex. Apex Trader Funding currently boasts tens of thousands of users across 150 countries.
Leeloo: Leeloo’s platform is unique in that it combines the values of farming and agriculture with futures trading. With its founders coming from a family of ranchers, the company offers a practice account, which traders must purchase to achieve a target profit trading mini contracts over a certain number of days. Leeloo requires that traders are active for at least 10 trading days using this practice account in order to move up.
From there, successful traders can advance to a Leeloo Performance Account, in which they are funded and must meet certain benchmarks for an opportunity to earn actual payouts. Once a trader has proven their consistency and discipline, the company may decide to copy the account with its proprietary software.
When Does It Make Sense To Use Funded Trader Programs?
Traders tend to consider funded trader programs when they have enough to invest in an evaluation account but don’t have enough equity to trade with. It takes money to make money, and this is especially true when trading futures contracts. Traders who are able to prove themselves with a test account open themselves up to the possibility of trading with the firm’s capital and retaining a percentage of the profits they earn.
If it seems too good to be true, keep in mind that there are some important requirements. For example, traders can expect to pay fees commensurate with their skill level in order to share in the risk the firm is inheriting. To participate in evaluation programs, traders shoulder all the risk, paying for the chance that they will succeed. As Topstep’s results show, only about one quarter of traders actually make it to funded status, and that is when the real pressure begins. Prop trading firms will expect consistent results, which requires the utmost discipline.
You Can Create A Similar Sim Setup At EdgeClear
Futures traders should be aware of yet another option, which is to establish a simulator setup at EdgeClear using EdgeProX, the company’s sophisticated trading platform with advanced charting capabilities.
The EdgeProX platform meets the criteria of futures traders with the highest of standards, including features like precision, innovation and customization through which traders can perfect their strategies. EdgeProX is where traders can test their trading strategies while mastering different instruments in various market scenarios without having to risk real capital.
Harness online tools to battletest your analysis, crystalize your trading strategy and gain the confidence you need to remove the training wheels and trade live. Because that is when the real fun truly begins.
Featured photo by Nicholas Cappello on Unsplash
A forward-thinking futures broker. Led by industry experts who understand the complexities of trading, Edge Clear combines the best of technology, service and risk control.
This post contains sponsored content. This content is for informational purposes only and is not intended to be investing advice.
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