Within the intricate domain of proprietary trading (prop trading), the art of drawdown management takes center stage. These troughs in trading account value, stemming from market fluctuations, find a potential solution in funding programs. Such initiatives orchestrated by trading firms grant traders access to augmented capital based on their performance history and trading approach.
This paves the way for larger positions, diminishing the reverberations of drawdowns. However, the panorama isn’t devoid of constraints. Traders are confronted with escalated performance benchmarks, necessitating meticulous risk management to sidestep funding curtailment or, in more severe cases, termination.
It’s vital to recognize that even ensconced in the realm of funding, drawdowns preserve their potency, fueled by market caprice and unforeseen circumstances. Flourishing in prop trading demands a delicate equilibrium: skillfully harnessing funded capital while steadfastly upholding the tenets of prudent trading, all in the bid to rein in the impact of drawdowns.
Take a look at this table and find out some of the prestigious prop firms funding programs and their limitations:
| Proprietary Trading Firm | One-Phase Evaluation Drawdown Limits | Two-Phase Evaluation Drawdown Limits | Direct Funding Drawdown Limits |
| E8 FUNDING | ❌ | Max daily floating loss 5%, Max overall absolute drawdown 8% (scaleable up to 14%) | ❌ |
| FTMO | ❌ | Normal accounts: Max daily drawdown 5%. Max overall drawdown 10%
Aggressive accounts: Max daily drawdown 10%, Max overall drawdown 20% |
❌ |
| ALPHA CAPITAL GROUP | ❌ | Max daily loss 5%, Max total loss 10% | ❌ |
| BESPOKE FUNDING PROGRAM | ❌ | ❌ | ❌ |
| FUNDED NEXT | Express: Max daily drawdown 5%, Max overall drawdown 10%
Stellar: Max daily drawdown 3%, Max overall drawdown 6% |
Evaluation: Max daily drawdown 5%, Max overall drawdown 10%
Stellar: Max daily drawdown 5%, Max overall drawdown 10% |
❌ |
| MY FUNDED FX | Max daily loss 4%, Max trailing drawdown 6% | Max daily loss 5%, Max loss 8% | ❌ |
| BLUE GUARDIAN | ❌ | Unlimited: Max daily loss 4%, Max total loss 8%
Elite: Max daily loss 4%, Max total loss 10% |
❌ |
| THE FUNDED TRADER | Max daily loss 3%, Max trailing drawdown 6% | Standard: Max daily loss 5%, Max overall loss 10%
Rapid: Max daily loss 5%, Max overall loss 8% Royal: Max daily loss 5%, Max overall loss 10% |
❌ |
| CITY TRADERS IMPERIUM | Max absolute drawdown 5% | Max daily loss 4%, Max total loss 10% | Max absolute drawdown 5% |
| FXIFY | ❌ | ❌ | ❌ |
| FUNDING PIPS | ❌ | Max daily loss 5%, Max overall loss 10% | ❌ |
| GOAT FUNDED TRADER | ❌ | No time limit: Max daily drawdown 5%, Max overall drawdown 8%
Classic: Max daily drawdown 4%, Max overall drawdown 10% |
❌ |
| FX2 FUNDING | 6% drawdown on the total account size or a 4% drawdown in a single day | ❌ | ❌ |
| FUNDED ENGINEER | ❌ | ❌ | ❌ |
| THE 5%ERS | ❌ | Max daily loss 5%, Max total loss 10% | Max overall loss 4% |
