How to Pass Prop Firm Challenge: Proven Tips for Getting Funded

By a seasoned trader with 10+ years of battle-tested experience.

Table of Contents

I’m glad to see that you’re preparing carefully before stepping into this challenging yet promising field.
With over 10 years of industry experience — and having seen countless traders succeed brilliantly and fail bitterly — I won’t give you any clichéd advice. Consider this a frank sharing from someone who has walked the path. Before you give a single dollar to any company, sit down, make a cup of tea, and honestly answer the questions in this first phase. Don’t skip it.

Stage 1: Self-Assessment – Are You Truly Ready?

This is the most critical phase, determining 90% of your chances of success. Do not rush to choose a prop firm if you are not solid in this step.

✅ Do You Have a Complete Trading Strategy?

  • “Complete” means: clear entry points, take-profit points, stop-loss points, and specific capital management rules (e.g., risking only 1% of the account per trade).
  • If the answer is “no” or “so-so,” stop. Go back to a demo account and practice until you can say “yes” with confidence.

✅ Have you been trading profitably and consistently on a demo account for at least 3 months?

  • Don’t fool yourself. If you can’t make a profit on a demo account (where there is no psychological pressure), you have no chance with a prop firm’s challenge account. Trade on the demo with capital and rules similar to the prop firm you’re targeting.

✅ Do You Keep a Trading Journal?

  • This is the most important tool of a professional trader. You must record every trade, the reason for entry, the result, and your emotions at the time. Analyzing the journal helps you identify your mistakes and strengths. Without a journal, you are just gambling.

✅ Do You Understand That Prop Firms Are Businesses, Not Charities?

  • Prop firms make money from failed applicants’ fees. Their rules (like max drawdown) are designed to eliminate undisciplined traders. You must see yourself as a business partner, bringing profit to them and to yourself, not as a lucky person who is given money.

Stage 2: Choosing the Right Prop Firm

After being confident with Phase 1, it’s time to choose a reliable partner.

🥇Reputation is GOLD

  • Look for companies that have been operating for a long time (at least 2-3 years).
  • Check reviews on independent platforms like TrustPilot. Read both 5-star and 1-star reviews to see what people praise and what they complain about (especially regarding payouts).
  • Watch review videos from the international trading community on YouTube. Search for “[firm name] + review” or “[firm name] + payout proof.”
  • Some highly reputable prop firms in the industry: FTMO
  • Warning: This industry has seen large firms collapse (e.g., My Forex Funds). Never put all your money and trust in one place.
  • Check out our Prop Firm Comparison Table for this year to find out which firms remain strong in the market.

📜 Understand the Rules — They’re the Real Opponent

  • Drawdown Limit: This is the reason 90% of traders fail. Choose a firm with reasonable drawdown rules that fit your strategy. Is the drawdown calculated based on end-of-day balance or real-time equity? The latter is much harder.
  • Profit Target: Don’t be too greedy. An 8% target might be easier to achieve than 10%.
  • Hidden Rules: Is there a minimum number of trading days required? Are there restrictions on news trading, holding trades overnight/over the weekend? Choose a firm with flexible rules that suit your trading style.

Choose rules that match your trading style.

📞 Test Their Support Before You Commit

Send a message via live chat or email. See how quickly and professionally they respond. When you have a problem, this will be your lifeline.

Stage 3: Passing the Prop Firm Challenge - The Real Competitton

This is the real test. Forget the profits. Your mission is capital preservation.

🎯 Shift Your Focus: Don’t Violate the Loss Limit

  • Tape this to your monitor: “Don’t focus on the 8% profit target. Focus on NOT VIOLATING the 5% loss limit.”
  • When you protect your capital, profits will follow. Trade smaller, risk less than usual. Remember, you have a whole month to finish, no need to rush.

🧠 Stick to Your Proven Strategy

  • Don’t get creative. This is not the time to experiment.
  • Whatever strategy you have practiced successfully, stick to it absolutely. The pressure of the challenge will make you want to try new things: that is a deadly trap.

🐢 Start Slow

  • In the first few days, enter trades with only 1/4 or 1/2 of your normal size to get used to the platform and the psychology. Once you have a small profit buffer, you’ll be more confident.

🚦Reduce Risk When Close to the Target

  • If you’ve reached 7% profit and the target is 8%, don’t try to “get it over with in one big trade.” Reduce your trade size to the minimum to slowly and safely cross the finish line.

Stage 4: Becoming a Consistently Funded Trader

Getting funded is just the beginning. Your first goal should be:

💰 Make Your First Withdrawal

  • Don’t think about doubling the account. Set a goal to make a small profit and make a withdrawal. The feeling of receiving real money from your efforts will be a huge psychological boost. It proves that this model is real and that you can do it.

🔁 Withdraw Profits Regularly

  • Establish a rule, for example: withdraw all profits every 2 weeks or every month. Don’t let profits accumulate too much in the account. Remember, that account is not yours; it can be taken away at any time if you violate a rule. The money in your bank account is what is truly yours.

📊 Treat It Like a Business

  • Plan, set monthly and quarterly goals. Trade consistently and professionally. Don’t let one bad day ruin a whole month of effort. Think like a professional, not a gambler.

📋 Daily Checklist for Your Prop Firm Challenge

Use this checklist every morning before placing trades during your challenge phase.

✅ Reviewed my trading plan
✅ Checked economic news schedule
✅ Defined risk per trade (no more than 1%)
✅ Verified platform connection
✅ Emotionally neutral before placing trades
✅ Not overtrading or revenge trading
✅ Journal updated after each trade
✅ Capital protection is priority
✅ End-of-day: review and reset

How to Pass Prop Firm Challenge - Final Thoughts from a Trading Veteran

  • Prop trading is a game of psychology and discipline, not about finding some magic strategy.
  • The winner is not the one who makes the most money in one day, but the one who survives the longest in the market.
  • Be patient, be disciplined, and risk management should always be your #1 priority.

I wish you the best of luck on your chosen path.

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Frequently Asked Questions (FAQ)

What is a prop firm challenge?

A prop firm challenge is a test phase where traders must prove their skills by following strict rules to qualify for a funded account.

Most challenges last 30 days, followed by a verification phase of another 30 days, depending on the firm.

Common causes include violating the drawdown limit, overtrading, lack of discipline, and not following a solid strategy.

The best strategy is one you’ve tested extensively, with low risk per trade and strict capital preservation as your top priority.

Yes, if your demo strategy mimics real conditions and you’ve been consistently profitable for at least 3 months.

No. It’s better to trade conservatively and avoid violating rules. Slow and steady wins the challenge.

Yes. Firms with reasonable drawdown and fewer hidden rules are ideal, especially for beginners.

You’ll receive a funded account and can start trading live capital, often with a profit split arrangement.

  1. No. Withdrawals are only available after you receive a funded account and begin trading live.

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