Forex Challenge: Can you make a living from trading via prop firm FTMO?

Trading Discussion Prop Firms
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Hi everyone,

So I thought I’d try something new. Most of the messages I get here or on social media are asking for advice on how to trade for a living. Most of the people lack forex knowledge and dont have much capital. My advice on the latter is get a job, get a 2nd job and save. However a few people got back to me saying it’s difficult to get a job or borrow money and even if they do they wont be able to earn much. Certainly not enough to live off on a monthly basis from trading. So I started thinking what else could they do.

Prop funds give you capital to trade if you pass their ‘tests’ and take a % of your profits. I had a read into them years ago and decided it wasnt for me and was a waste of money. However, taking into consideration that people cant save up a lot of money and strategies are not doubling their accounts every month as most instagram/youtube traders promise, I thought this was worth me looking into again.

I feel what I’ll learn will be important especially so I can talk from experience when people discuss prop funds. I’m not sharing strategies, sending signals, selling courses or discussing analysis. I have only 2 things I want to answer:

  1. I want to know if someone can get a funded account with good risk management and knowledge. Can you really be funded with money to trade?
  2. If so, can you actually make a living consistently from trading the prop funded account. Is it a viable option with all their trading rules?

Also a lot of people aren’t sure whether these companies are trustworthy or that they wont let you withdraw profits. So Im going to open an account and explain all the ins and outs and we’ll see what happens.
Hope this is helpful to people thinking of getting into this.

First step, need to find a prop fund!

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I talk about it here: YouTube

The main point is that, when you get funded, you still have constraints mainly linked to maximum drawdown.
So you get $100,000 to trade, but maximum drawdown you can reach is 5%. If you go over it, they will take the money back.
Tell me how this is different than trading $5,000 of your own money :slight_smile:

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There are quite a few prop funds out there. I’ve been through a few websites but the one that stood out and I’ve also read other people mentioning and asking about them is FTMO. There are a few youtube videos of people saying they’ve passed but that’s all it is. They’ve got a funded account but didnt show the journey from the beginning which i think is more important.

I also like that they have a choice of brokers and you can demo first to see how the rules affect your trading and get used to the broker. The partner brokers are:

Ftmo LMAX
Admiral Markets
Purple Trading
CMC markets
Blueberry Markets
Bossa
Crescofx
XM.com
Blackwell Global

Second step: Pick a broker

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The way I’ve looked at it is that you can take larger positions and the potential for a greater return is better with a larger account. For eg £5k, 5% a month would be £250, but in 100k would be 5k. This is a good amount to fund a personal account incase you do lose the funded account the next month.

Secondly, I’m doing this for people who dont have £5k. They cant save it for whatever reason. For those people who have good risk management theres potential to change their lives with a smaller outlay at the beginning. But we’ll see if its realistically possible!

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Ok, I get your point.
In my opinion, math is still on their side and not on the trader’s side.
Considering TopStepTrader that is a leader in this field.
The account of $150K has the following important requirements:

  • Max Drawdown after getting funded $4,500 (3%);
  • Monthly Price $375;
  • Target to get funded $9,000 (6%, twice the drawdown, very hard to achieve in one month);
  • After getting funded, you keep only 80% of the profit, not 100%.

Say that you can achieve the target in 3 months (already an amazing result, in my opinion), you spend $1,125 to get funded. Now you have an account that, on the paper, is $150K, but reality is that you manage $4,500.
I don’t see any difference between losing 3% with that account and it is game over, or losing 100% with your $4,500 and it is game over anyway.
You may think: “well, still I spent $1,125 to manage $4,500, better than nothing”. But it won’t take long till the difference between getting 80% of the profit and 100% of the profit will kick in.
If there’s any good trader out there, proving to be profitable over a considerable period of time, I’m going to give more than $4,500 and take a percentage of the profit, without requiring any monthly payment to prove me that you are good.

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hi dude, here s some update

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Thanks for that. I watched his other ones first. The slick video, 3 screens, charts open while hes talking, keeps saying ‘basically’ lol. It all put me off. The problem is I cant trust these kind of people, they’re exactly like the others, a bit like marketers. His first week on the ‘funded account’ had a drawdown of >10%, I’m not sure what hes trying to teach. But I’ll watch this interview too, see if he adds anything.

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my point was that 92% fail. they do pay out if u pass, and manage to stick to those rules from what i know. and the payoff is 70% which is way better then most of these prop firms. ofc topstep has 80% but theyr combine design is made to make u pay urself. there s no room for error in there or room to be more adventuros with ur trades. i guess ftmo might be worth it as long as u know what ur doing. 2% risk per trade can t be an option, since u have 5% max daily loss and 10% max loss. but 0.5% per trade could work, plenty of room for trial and error, unknown market conditions so on and so forth.it also depends on ur market aproach, cos there are news events u can t trade or be in a trade during…i mean u can, but if ur sl or tp gets triggered ur account is terminated. very doable imo but it s all in the eye of the beholder, meaning the trader s patience and eyeballing the trades that are worth the risk.
i think u can do it if u trust urself and u have enough confidence in ur market aproach, cos from there all he misery starts, not from the trading system in itself.
may the gods be with u

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Ah is see. Yeah so the first answer is yes they do actually give you a funded account. So I’ll probably go for the highest amount then.

I guess the question is what are the difficulties, is it geared for you to lose especially if only 8% pass. Or is it just a matter of strategy and good trade and risk management. It’ll be interesting to find out.

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the thing is this: u trade on demo before and after u get funded, always a demo acount. so if theyr legit u should be ok just trading ur usual stuff no matter. i was actually doing a trial for the new ftmo lmax platform and datafeed. all good except high spreads, slippage and stop hunts that were shown only on theyr platform. now i ve been told that most of the brokers had those variable spreads few weeks back, which is true but they were actually higher on lmax. anyways, spikes on gold mini, that can t be found nowhere else, cos they don t allow u to trade gold. everything else might check out ok now that the crazy corona is out of the woods, but i m still a bit cautios. i d say do a trial for 2 weeks, see how things look, get aquainted with theyr risk parameters and then go for the challenge. i saw quite a few getting funded etc…but trust must be earned…and i have almost none to give(trust) specially in this bussiness. cheers

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Yeah I need to get used to mt4 first. I’ve never used it!

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I was interested in these kind of challenges, but too many constraints, and the entry fee is quite high.

Also, you can’t keep your trade open over the weekend if I recall correctly.

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Lol the reason I’m doing this is because I thought the entry wasnt expensive for people. I’m a daytrader so I don’t hold over weekend anyway.

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This step actually took longer than I expected.

All the partner brokers platforms are MT4 except purple trading which also uses ctrader. The leverage for them all is 1:100 except admiral which is 1:50.

The ctrader was not very user friendly so I had to choose to trade on MT4. I opened multiple demo mt4 accounts. However, because I’ve never used MT4 before I’ve had to learn it all from scratch! It’s been quite difficult as there isnt a comprehensive video out there with all the information in one place. Despite all that, there are a lot of things mt4 cant do eg easily manage risk, show how much margin you have left before you take the trade, show your SL/TP on the chart before you place the trade, close all trades at once etc.

The other thing I found hard was using lots. I’ve always traded with £ per pip which is so much easier to know what your risking. Also pips are counted differently on different mt4 platforms depending on if the price is 5 or 6 decimals! :man_facepalming: If you’re used to MT4 then you’ll get through this part much faster.

I’ll sign up for the challenge next week as Friday is a bank holiday in UK.

Third step: Familiarise myself with MT4 and start the challenge Monday 11th May 2020.

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Hi All, I came across FTMO a few weeks ago too. I’d also watched the above video and a few more.

For anyone that’s wondering, they do offer demo accounts, that track their rules. only exception being they’ve half the Min % and days to achieve it in. (so 50k account, Max drawdown 10%, max daily draw down 5%)

I’ve been trading on their demo since the start of the week, averaging around 1%. I did have to change the lot size I was using though, to compensate for the max drawdown, compared to my live account.

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It does seem that their funded accounts lean more to day traders and scalpers. I think they’ve tried to help swing traders more be removing the goal of half you trading days need to be in profit.

Although you need 10 active trading days a month to pass, but a position that is held across two days only counts as one active day. Seems a bit pants tbh, if your strategy involves higher time frames.
You can get around this by opening and closing a small position though.

I think the way their making getting the 90% fail rate is on their first verification phase.

So to pass the first test, you have 30 days ( so around 20-22 trading days) to gain 10% on an account without ever dropping more than 5% in a day and 10% overall. I personally think this knocks most people out. Though if you do pass all the other rules( 10 trading days, Max loss and Max drawdown) and end the month in profit.
They do let you take the test again for free. So if you are a profitable trader, eventually you will pass the test. and seeing as the next phase is 5% over 60 days(2.5% a month) once you pass the first stage you should be fine.
Also once you’ve made a profitable trade, you max drawdown increases based on that trade.

So if you’ve made 1% all ready today, then you can now loos upto 6% on the day and not fail the challenge.

Taking a daily 5% dip, is a lot to any account, so i can see why they set that. if you’re dropping 10% in a month that’s an extremely bad month.

I’ve looked at a lot of the prop firms, I think FTMO seems like a good one. They’re clearly making money from the tests though 90% fail rate and 540 eur for the 100k test.

if you dont fancy paying that, you could look at https://traderseed.io/ (this dude has a youtube)
He basically pays for a 10k account with FTMO and then you use that money(by growing the account) to fund the test fee for a the 100k ftmo account. you then split the 70% profit from FTMO with him on a 50/50 basis. you’d be worse off than doing it yourself, but this is 0 risk for you to prove you could pas the FTMO challenge.

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Yeah that’s a good point actually. There is a free demo trial that FTMO provides on their website. It’s good to see what the client area will look like when you apply for the challenge. Also how the metrics change depending on your trade and it clearly shows you what objectives you’re passing and what you’re not. Also how far you are from each objective. It lasts 2 weeks, is for a 50k account and is on mt4. I did it for a few days just to see what the client area looks like and practise. Like you, I’d recommend people to use this trial for the whole period. You can apply for more trials so effectively they can treat it as a challenge practise and see if they pass over the 2 trials. As that would be equivalent to one challenge which lasts 30 days.

Yeah I watched his videos yesterday and checked out the website. It’s actually not a bad shout! Hes giving you a free 10k account so you cant really say anything bad. If you have a strategy, are patient and control risk then potentially you could pass the challenges he puts you through and you would get a free 10k account trial. Then using the profit from 10k after split with him and FTMO you buy a 100k account and build from there. Personally I didn’t like the amount of challenges he puts you through lol, its 5 seperate trials. And the first 2 are 10% profit in 2 weeks which is really 10 days. This is a bit steep. However it’s all free so no money upfront.

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Yeah exactly, in all honestly if you think you can pass the challenge, then going through trade seed seems pointless.

As you’d then only really be taking home 35% of you’re monthly profit. For the ability of saving $610.

Seems like the tradeseed bloke is making a good return on this.

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to me personally, doesn t look like a good option, he takes 50% of what u make after the 70 30 profit split with ftmo. u d be looking at pennies. but yeah, could be an option if u really don t have 1 cent to pay for the challenge. all u have to do is not trade or have trades open during their restricted events, i found that the more challenging thing for me, as i often like to pre position myself ahead of news if the footprint is there from the large operators, but i managed to work around that. and to be honest, it s better u have the 5% max daily and 10% maxx loss, teaches u a bit of money management. i heard that many passed the challenges and stroke out the first month on funded account, i guess they tried to make as much as possible and killed 1 of the rules. u can be a little more agressive during the challenge to make the 10%, but once u get funded u can only go for whatever u think it s a high probability trade, as there s not a profit target anymore, u don t have any days u have to trade etc…so the stress is less. i think these trials are good for newbies also or for people that do know how to trade but have issues with money management or being patient and overtrading.

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I’m planning on joining again. Any advice?

Edit: 1st time, I reached their target in less than 3 days but forgot about one of their rules so money management screwed me…

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my honest opinion would be to wait and do the trial few times and pass it, like few times in a row. that way u gain some confidence, and ur trades will be different. it s not about hitting the profit target as soon as possible, but about being able to stay afloat, cos u never know market conditions. and the good thing is, if after the time target ur in profit but still haven t reached their goals, and u didn t broke any rules, u get another free challenge at no cost. so being consistent in ur aproach and managing risk should be first 2 things imo u need to focus on, not profit target.
atleast that s what i d do.
cheers

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