It’s about some time I’m questioning myself if a trading challenge with a prop firm is really better than using my own capital and I’ve taken out different opinion about that.
But today I went through this topic and maybe I’ve found the incongruence I was searching for.
They are assuming that in a 100k account with 10k max allowed total draw down risking 500 per trade equals the 0,5% that’s not true because being the real capital 10k before blowing out the account we need to calculate the risk this way 500/10.000=5% that’s not affordable for many of us.
Everyone here was basically being told to risk 1% of the capital for any trade so that you can loose 99 trades in a row and still have one shot left in the pocket; in the previous example with 500 bucks instead you can loose 19 trades in a row before you’re at the last shot: it’s different.
Why am I questioning this? Because naturally like other people I’ve started thinking once passed the evaluation phase of a funded account I would have played with a very large account size that it’s well beyond my real possibilities. I would have played with 100k so risking 1% for any trades with a very basic 1:1 RR would have been 1k: bingo! But that’s not true, because 1% of the real capital to play with is hundred bucks and not 1k.
Imagine we can afford to play with 10k of our own with the broker leveraging 100:1, no rules on trading, no profit split, no other stuff; now if I purchase a 100k challenged account for 1k where i can only loose 10k I’m in the same stuff… plus the fck rules. But someone can say: you’ve spent only 1k to play with 10 that’s the good thing. Ok, but i need to pass the challenge doubling the real account before withdrawing money. This mean i need to wait at least 1 year if i’m able to grow 6% any month or 2 years with 3%, right? For what? For the same 10k I already have in my pocket and that I could have really doubled during the year (very very best case) spent for the challenge.
I would appreciate to read other’s opinion about this topic maybe telling me what i’m not considering appropriately and leading me to a wrong position.
Thanks for listening.
Bye.