How to choose a prop firm

Why the order matters more than the list

Every comparison site publishes roughly the same fields. What differs is the order, and the order is where nearly all the value sits.

Most comparisons lead with price and profit split, because those are the two numbers firms advertise and the two easiest to put in a table. Both belong near the bottom. Price is recoverable — a failed evaluation costs you a fee. The drawdown structure is not recoverable, because it determines whether you keep an account at all, and a 90% split on an account you cannot hold pays 90% of nothing.

What follows is the order that reflects what actually decides outcomes, worked through field by field, with a scoring method at the end.

1. Drawdown structure

This is the field. If you only check one thing, check this.

Three questions, all of which need a specific answer:

• Static or trailing? A static limit is fixed at your starting balance forever. A trailing limit follows your highest equity upward and never comes back down.
• If trailing, intraday or end-of-day? An intraday rule counts unrealised profit, so a trade that runs $4,000 in your favour and closes flat has permanently cost you $4,000 of allowance. An end-of-day rule only updates on closed balances and is a materially different product.
• Balance or equity? A balance-based limit ignores floating loss. An equity-based limit counts it, which means a spike against an open position can close the account before you have made any decision.

The gap between the most and least forgiving combination, at an identical advertised percentage, is roughly threefold in practical terms. It is the difference between an evaluation most competent traders can pass and one where the structure itself is the main obstacle.

Full treatment: static vs trailing drawdown. Firms we have documented as static are listed here.

2. The target-to-drawdown ratio

Divide the profit target by the total drawdown allowance. This single derived number predicts difficulty better than any field a firm publishes directly, and almost nobody calculates it.

• 0.8:1 or lower — comfortable. You may be wrong more than you need to be right.
• 1:1 — a fair test. The industry standard for a well-designed evaluation.
• 1.5:1 — demanding. Workable with a high win rate or strong reward-to-risk.
• 2:1 and above — for most strategies there is no risk level that both reaches the target in reasonable time and survives a normal losing run.

That last bracket deserves emphasis, because it is where discipline stops being the variable. Sized to survive an eight-loss run, the position is too small to reach the target before you lose patience. Sized to reach the target, it breaches on an ordinary sequence. The arithmetic is in risk per trade for a 10% target.

Calculate the ratio for each phase separately on a two-step evaluation — the phases often differ.

3. Payout terms

Getting paid is the point. A firm that makes it awkward is a firm you will regret regardless of how good the evaluation felt.

What to establish:

• First payout wait. How long after funding before you may request anything. Ranges from on demand to 30 days.
• Cycle thereafter. On demand, weekly, bi-weekly or monthly.
• Minimum amount. A firm with no fee but a $500 minimum is worse for a trader making $200 a month than one charging $10 with a $50 minimum — because unwithdrawn profit is forfeited on a breach.
• Methods available in your country, and their cost including the second hop to your bank. See payout methods and fees.
• Whether a consistency rule exists, and whether it has a number.

That last point is the one that catches people. An unquantified consistency requirement is checked by a human at payout, against a standard you were never given, after you have done all the work. See the consistency rule, explained.

4. True cost

Not the sticker price. Fee × your honest attempt assumption, plus activation, platform and data charges for the months you expect to hold the account.

The comparison that works across firms and account sizes is cost per $1,000 of funding:

• $155 for $10,000 → $15.50 per $1,000
• $250 for $25,000 → $10.00 per $1,000
• $540 for $100,000 → $5.40 per $1,000

The largest account is the cheapest capital by a wide margin, which is the opposite of what the prices suggest.

Then add the recurring charges, because they reverse rankings. A $29 futures evaluation with a $130 activation fee and $85/month of exchange data costs over $1,100 in the first year — more than a $540 forex evaluation with everything included. See hidden fees and run it through the true cost calculator.

5. Platform and instruments

Obvious, and still a common reason traders abandon an account they paid for.

Check that the firm supports the instruments you actually trade, on a platform you can actually use, with the data you need. For futures specifically, check which exchanges you must enable and what each costs monthly — enabling exchanges you do not trade is the most common avoidable expense in this industry.

Also check execution-adjacent details that are easy to overlook: available leverage, whether micro contracts or micro lots exist at your account size (which decides whether you can size properly at all), and whether the rules dashboard shows your distance to a breach in real time. That last one sounds cosmetic and is not — knowing your buffer without calculating it manually meaningfully reduces mistakes.

6. Track record

How long has the firm operated, and has it traded through a volatile period?

Longevity is not proof of integrity. It is proof that the firm has paid through at least one bad stretch, which is evidence a new firm cannot produce at any price. A firm with four years of operation and no unresolved payout complaints has demonstrated something structural.

This does not mean avoiding newer firms. It means weighting them differently: a smaller share of your funded capital, payouts taken promptly rather than accumulated, and heavier scrutiny of the rulebook since you cannot lean on history. See alternatives to the biggest firms.

7. Profit split

Last, for two reasons.

First, it applies only to profit you actually kept, on an account you did not breach. Everything above determines whether that condition is met.

Second, the percentage is less important than what it is calculated on. Commissions and swap come off the gross before the split, so a 90% split on a high-commission account can pay less than 80% on a cheap one. At $10,000 of gross profit, 90% after $1,200 of commissions pays $7,920; 80% after $300 pays $7,760 — near-identical, and the cheaper account wins outright at higher trade frequency.

Also check whether the advertised figure is the starting split or the scaled one. "Up to 90%" usually means you start at 80%. See profit splits and when they rise.

Match the firm to your own trading

The best firm in the abstract does not exist. The right question is which firm fits the equity curve you actually produce.

If you are a scalper or short-hold intraday trader — small excursions, smooth equity, high trade count — trailing drawdown costs you relatively little, because the high-water mark advances roughly in line with realised profit. You can afford to prioritise cost and payout speed. Watch instead for minimum hold times, which can void your entire approach.

If you are a momentum or swing trader — wide targets, large favourable and adverse excursions — intraday trailing is close to disqualifying. Prioritise static or end-of-day trailing above everything else, and check weekend and overnight holding.

If you scale into positions, avoid equity-based limits of any kind. Floating loss on a scaled-in position is exactly what those limits measure.

If your returns are concentrated in a handful of sessions — news traders, breakout traders — the consistency rule is a structural mismatch, not a detail. Find a firm that publishes no such rule and confirm it in writing.

If you trade news deliberately, that permission chooses your firm. It is worth more to you than a better split or a cheaper fee.

If you do not know which category you are in, measure it: take your last two hundred trades and record the maximum favourable and adverse excursion on each. That distribution answers the question better than any general advice, including this.

A scoring worksheet

Put your shortlist in a table and score each field. Weight them roughly as follows, which mirrors how our own PFH Score is built:

• Rule fairness — 30%. Drawdown type dominates. Add daily limit width, EA permission, weekend holding.
• Payout terms — 25%. Split, cycle, minimum, and whether consistency is quantified.
• True cost after fees — 20%. Cost per $1,000 of funding, including recurring charges over your expected holding period.
• Platform and instruments — 15%. Coverage of what you actually trade.
• Track record — 5%. Years operating.
• Transparency — 5%. How much of the rulebook is published, and how recently.

Score each firm 0–100 per field, multiply by the weight, and sum. The exercise takes twenty minutes and its main value is not the ranking — it is that filling in the table forces you to find fields you would otherwise have skipped. A firm you cannot score is a firm that has not published enough, and that is itself the finding.

The six questions to send support

Before paying, in writing, and keep the reply:

1. Is the maximum drawdown static or trailing, and if trailing, does it update intraday or at end of day?
2. Does floating loss on open positions count toward the daily loss limit?
3. At exactly what time, in my timezone, does the trading day reset?
4. Is there a consistency requirement, and what is the exact percentage? Does it apply during the evaluation or only on funded accounts?
5. Is there a minimum hold time, or any restriction that would affect my style specifically? (Describe it plainly.)
6. Which payout methods are available in my country, what do they cost, and what is the minimum withdrawal?

Two things come out of this. You get answers you cannot reliably get from a marketing page. And you learn how the firm communicates — a firm that answers all six with specifics is a firm you can plan around, while vagueness at the pre-sale stage tells you what to expect at the payout stage.

Keep the replies. If a payout review ever turns on how a rule was applied, a written statement from the firm is the most useful document you can produce.

Warning signs that should end a shortlist

Any one of these is worth walking away over:

• A rule without a number. "Consistent trading behaviour", "reasonable strategies", "manipulation" with no threshold. This is the most reliable predictor in the industry, because such a rule can mean whatever it needs to mean when a payout arrives.
• No identifiable legal entity. No company name, no registration number, no jurisdiction. You have no counterparty.
• Terms not published before purchase. If you cannot read the payout policy and the prohibited-strategies list before paying, do not pay.
• Broad discretionary payout language. Some discretion is normal; unbounded discretion over ordinary payouts is not.
• Economics that do not add up. A 100% split with instant funding and no meaningful drawdown constraint is not generosity.
• Retroactive rule changes. Check whether terms can change and be applied to profit you have already made.

See prop firm scams and how to spot them, and check our unlisted firms page for firms we have removed and why.

What to ignore

Headline account sizes you will not trade. "Up to" splits you will not start on. Trustpilot scores, which in this industry measure how recently a firm ran a review campaign more than how it treats traders. Any ranking that does not publish what it is built from.

And be sceptical of your own reaction to a big discount. A code changes the fee, not the rulebook. An 80% discount on a firm whose drawdown structure your strategy cannot survive is a cheaper way to lose. See are discount codes worth waiting for.

A practical sequence

1. Measure your own equity path — worst losing run, worst day, typical adverse excursion.
2. Filter on drawdown structure to firms compatible with that path. This usually removes half the market immediately.
3. Calculate the target-to-drawdown ratio for the survivors and drop anything above 1.5:1 unless you have a strong reason.
4. Read the payout section in full for the remaining three or four.
5. Send the six questions and compare the answers.
6. Run true cost with your honest attempt assumption and expected holding period.
7. Buy the smallest account at the winning firm that lets you trade your normal position size.

Step seven matters. The first evaluation at any firm is an experiment, and the experiment returns the same information at any account size. See passing on a small account.

How we do this ourselves

The PFH Score applies exactly the weighting above to documented fields only — the firm's own terms, pricing and payout policy, plus how long it has operated. Reviews, commission rates and opinion are not inputs, and there is no field in the calculation where they could be.

A firm is only given a published score once documented components cover a majority of the rubric weight. Below that line we print "not enough data documented" rather than a number, because a score assembled from two minor components would be worse than none. Firms in that state appear on the comparison without a position.

Where we know the commission a firm pays us, it is printed on that firm's profile so you can check whether the ones we rate highly happen to be the ones paying most. See affiliate disclosure.

Futures, forex and the rules that differ between them

Two firms can look identical on a comparison table and be different products because of the market they are built around. Knowing which set of conventions you are shopping in prevents most of the mismatches.

The practical consequence is that a strategy should pick the category before it picks the firm. A swing method that holds for days does not belong on an account that must be flat at the close, no matter how good the firm is. A high-frequency intraday method belongs where commission is quoted per contract rather than buried in a spread, because that is the only place its real cost is visible.

Get the category wrong and every other comparison you make is between the wrong things. That is why what to look for in a futures firm reads so differently from the equivalent forex checklist.

Reading a rulebook in fifteen minutes

You do not need to read a funded agreement end to end. You need to find nine things in it, and they are always in the same places.

1. Search "drawdown". Establish trailing or static, equity or balance, and whether it locks.
2. Search "daily". Establish the percentage, the measurement basis and the reset time with its time zone.
3. Search "consistency" and "distribution". If either appears, find the number and when it is applied.
4. Search "payout", "withdraw" and "cycle". Minimum, frequency, and the first-payout timing.
5. Search "refuse", "sole discretion" and "review". This is the clause that decides everything else.
6. Search "prohibited". Check your own strategy against the list, especially if it is fast or hedged.
7. Search "inactivity". Find out what a quiet month costs.
8. Search "fee". Activation, platform, data, reset, withdrawal.
9. Search "amend" or "modify". Whether existing accounts are grandfathered when rules change.

If a search returns nothing, that is a finding rather than a relief — a rulebook with no definition of a breach has not omitted the rule, it has reserved the right to define it later. Save the document as a PDF with the date in the filename. It is the only version you will be able to point at if the page changes, and pages change.

A worked shortlist

Three anonymised firms, scored on the criteria in the order given above. The point is not the winner but the pattern of how a shortlist collapses.

Firm B is cheapest and has the best split, and it should be eliminated first: a 6% equity-trailing drawdown against an 8% target is the hardest ratio on the table, the payout clause is discretionary, and there is no rule history to hold it to. Firm C is sound but costs more and requires a platform change, which is a real cost paid in mistakes during the first weeks. Firm A wins on the two criteria that decide outcomes, despite losing on both criteria that are marketed hardest.

Run this exercise on paper before you spend anything. It takes half an hour, it is the same half hour whether the account is $10,000 or $200,000, and it is the highest-return half hour in the whole process.

When to switch firms, and when not to

Switching is usually a mistake dressed as diligence. Three reasons that genuinely justify it, and two that do not.

Switch when: a payout was delayed without a cited clause; the rules changed against existing accounts without notice; or your strategy has evolved into a category the firm's structure does not fit — for instance you have moved from intraday to swing at a firm requiring flat closes.

Do not switch because: you failed an evaluation, or because another firm is running a discount. Failing is information about sizing far more often than it is information about the firm, and taking that information to a new rulebook means paying to learn a second set of mechanics while the first lesson goes unlearned. Every switch resets your familiarity with the exact measurement details that decide breaches — the reset time, the equity basis, the day counter — and that familiarity is worth more than 30% off.

If you do switch, carry the paperwork habit with you: a saved rulebook, a written note of the four measurement details, and a first payout requested early and small. It is the same routine described in how payouts work, and it is what makes a new firm knowable within one cycle instead of three.

Where to go next

Read static vs trailing drawdown before anything else — it is the field this whole method is built around. Then position sizing against a drawdown, which turns the firm's numbers into your trade size.

Then open the comparison and filter on the structure that suits your trading, rather than sorting by price.