What is a prop trading firm?
A proprietary (prop) trading firm lets you trade its capital in exchange for a share of the profits. Retail prop firms, the ones listed on this site, sell you a paid evaluation instead of hiring you.
The basic model
You pay a one-time or monthly fee for an evaluation (also called a challenge, combine or test). If you reach the profit target without breaking the rules, you get a funded account and keep a percentage of the profits you make on it.
The risk to you is the fee, not the account size. A “$100K account” does not mean you can lose $100,000; it means the firm’s rules are sized against $100,000 of simulated buying power.
Where does the firm make its money?
Most retail prop firms earn the majority of their revenue from evaluation fees, because most traders do not pass. Payouts to successful traders are a smaller cost. That is not a scandal, but it explains why rules (drawdown, consistency, scaling) matter so much: they decide how likely you are to pass.
Simulated vs. live capital
Many futures and forex prop accounts are simulated (sim-funded) for at least the first stage, with the firm paying you from its revenue or hedging pool. Some firms later move top traders to live capital. Always check what “funded” actually means at the firm you choose.
How to read the comparison tables here
We focus on the rules that decide whether you can actually reach a payout: the drawdown model, consistency rules, fees after passing, payout buffers and scaling. Read the guides linked from each table row when a term is unfamiliar.