You can approach prop firms in a style of scalling. Start with a 5k account for $49 and if u pass, the money u make from the 5k, you can then purchase the 10k account and so on until max allocation. In that way if u keep losing the 5k challenge. You wouldnt have lost too much money ($49) however u gain something more valuable than money, EXPERIENCE!

Yes, the prop firm model is extremely successful based on accepting your money with a smile. Excellent advise. You absolutely need to be consistently profitable BEFORE you consider taking the challenge. Otherwise say goodbye to your hard earned money.

The other thing you didn't mention is the max drawdown you are supposed to incur with the prop firms. You find that a 10,000usd account has a max drawdown of 500usd. That essentially means they gave you a 500usd account.

If you are not profitable with prop firms, you are not profitable anyway. I don't care whether prop firms are profiting from losers. I care about my profitability.

END, This is very true, rushing the process will miss with your psychology I've been studying for 5 years now while I'm in college doing it both. And now I am a graduating student and at the same I am almost done studying with FOREX. And I might say that the process gives me a lot of knowledge to reach the word "AN INFORMED TRADER" AND ''CONCISTENCY''. And I am planning to get a into FUNDING next month wish me luck. God bless Us All

I 100% agree man. Very well said. I like to keep a close eye on the spreads and rules of the firms before I would ever buy a challenge because like you said 99% are setup for you to fail. But if there’s a company with rules I like and they do in fact pay out your profits, then I think they can be beneficial

End. I don't usually comment but I like how you let traders know what's realistic in the trading industry and what's not realistic. You are really transparent and thats why I'm subscribed to you 💯

The most futures propfirm counts the unrealized profit to drawdown. Topstep payment rule, you dont get payment, till you didnt have 5 days with +200 usd profit. And every single new payment only with this requirement.

You are correct. The original prop firms operated in commercial office buildings and they did trade real money. But, you had to buy in with several thousand dollars of your own capital and you had to pay for the use of your computer, phone, market data, broker commissions, etc. This was before on-line trading, high speed internet VPS's, etc. In addition to paying to rent your workstation, you could only lose as much as you brought in. The only way to have a fast network connection for your market data and your order execution was to pay for a dedicated data circuit also known as a lease line which was a point to point fast network pipe from your office to the exchange and or to your broker. These dedicated network connections cost hundreds or thousands of dollars per month. So, each trader had to pay a share of this cost. As prop firms moved to the internet, the new business model required you to pay a monthly fee for training with simulated trading with strict rules and evaluations and most people will never pass. If you do pass, you supposedly get "funded". But, even as a funded trader, you are probably still trading in a sim account and any profits you think you're making are simply being paid out of the coffers of the simulated program.

I have simple take on this Before taking a prop firm challenge or even thinking about putting some money into a brokers account and start trading I want you to ask yourself "Am i profitable"? "Do i have a backtested strategy that provides consistent returns"?? If you cant answer these two questions then dont evne think about trading untill you meet those requirements,its that simple! Would you jump into a swimming pool if you cant swim,No right? Why, because lifes precious. Treat your time and money in the same way. This is the no1 reason why 90% fail,they enter into this market without the proper knowledge and these prop firms or brokers make the most money out of it.

Thanks Nick … as someone who is on the fence about taking a challenge this was very helpful

99% of Prop firm B-Booking? 😢 This is serious!!!!! Thank you so much Nick for sharing this. This is an eye 👁️ opener for me

Failing challenges are not the only way Prop firm make money. They can also copy trades of the profitable traders (which they already do) to earn money. The reason for surge in number of prop firms is because its the ULTIMALE BUSINESS. They make money from loosing traders (through challenges), and they make money from winning traders (copying trades). Competition will soon lead prop frim to give out 100% Profit split (some prop frims already offer this). So Prop Frims don't really care if you're profitable or not, cause they are gonna make money both ways.

Funded Trading Plus talked about what Nick talks about. They're that 1% prop firm that wants you to make money so they can too. They also use low regulated type of leverage. They benefits Swing Traders big time too! Day traders and scalpers are still welcome there.

I don't see why they would B-book you. They are not Brockers. At the test phase, you're on a demo acc. If you fail, the money is theirs. If you win, they've got a potential winner.

I'll correct you on this 1 thing nick... Firms actually want very consistent successful trader on their platform... they make 10x the money these profitable trader make... they have some sort of trade copier that copy the trades of successful traders... FTMO Have mastered this

I think it's ok for them to B-Book because most traders are not succesful anyway. The only issue is when they do something against your trades but the B-Booking as an action itself is not bad. They're just trying to take advantage of the fact that 90% of the traders are not profitable.

Hey Nick I made it to the "end". I really enjoy these kind of videos you make about the industry a lot, thanks. As you were saying, in my opinion, paying for live test from a prop when that person can’t make steady profit (with small drawdown) is like paying for a driving exam without ever once being behind the wheel, it’s pretty crazy and desperate. I think a lot of these prop firms do prey on the desperation of many. That’s an ugly side of business but it’s legit. I wish traders, who know deep down know that they're not ready to trade yet, take a leaf from your advice and do not throw away their money. They’re best saving it until they are ready.

Perspective bro perspective Whether Nick is right or wrong B booking or Z booking what ever i don't care Imagine being that guy who sees 18year old guys making money passing challenges here and there and you are here complaining about how they made you fail Focus on what you can control back test fix your psychology do your research about the prob firm Remember you are just a costumer and no one owes you nothing My request to nick is for him to show proof of how easy or difficult it is to pass a challenge

People say you should be trading with real money to feel the pressure and live market. And the fact that you are giving out money to prop firm, and in my opinion, it does give you a feeling of trading real money even in the challenge. Instead of a proven consistent profitability, I believe giving the money to prop firm to train myself is better than risking all my capital

Most prop firms have a max allocation of 600K, for good reason. There is a Prop firm put there, I won't mention the name, they actually exploit their profitable traders, by copying their performance on much higher capital, we're talking 10-20X more capital. In that sense, the traders that are profitable, make these firms more money than challenge fees ever will. Think of it, 90% profit split is nothing when the traders system is being implemented on 20 times more capital, return on investment that way is astronomical.

ive had a 50k account with ftmo and MFF, i understand that b-booking is a thing but as long as your consistent and onside with your bias, you cant really lose, people use tight stops and a large RR, But in my experience is that as long as your not greedy and take logical, safe setups you cant really lose imo

last year had the mentality of making 10% or more every month but now that im starting to get into propfirms im like, if you get funded 1 or 2 million in capital making between 2-5% monthly is an important amount of money and very simple and realistic results.... Great video

End. Key point, make sure you're profitable before trying out prop firms

End. Looking forward to becoming profitable in the future. I do not want to depend on prop firms, but I would like to use them as a stepping stone as soon as I can be consistently profitable.

End. Nick certainly knows how to trigger the people with things they don't want to hear but need hear.

END. Good content. i like the chat runing on the background

Very end! Great Info.

Prop Trading should not be characterized as trying to get rich quick. Prop firms are a decent opportunity ONLY if you are paying a huge 80 to 90 percent discount. Learning to trade usually involves losing lots of money as you learn. Deeply discounted prop evaluation accounts can reduce this usual cost. However, I think people should NEVER pay for resets. Spend the 20 dollars a month or so and not a penny more and build your strategy and discipline. Use evaluation accounts to get your greed and impatience under control.

Made it to the end. Great and timely video, thanks! The services that pass and trade on your behalf (purportedly) using prop funds are also proliferating.

Nick I'm using prop firm profits to grow my personal account faster so I can risk one percent and less and be happy with the profits. My personal account is also my savings so it can outperform inflation

made it till the end. I used to have few accounts with theproptrading till one day they just shut down with no warnings or heads up, my advice is save up your earning from props to have your own capital.

People talking about this in a bad way makes no sense to me at all if you didn’t realise prop firms are for serious traders only of you are not profitable yet why would you buy a challenge and blame the prop firm for b booking you 😂 your just a terrible trader

a book or b book . i dont care what i care about is getting my withdrawal

Waiting for this notification

End❤❤❤❤. I'm a funded trader by The5ers prop firm and I totally agree with your sentiments on this one 👊

Also, it's not an issue for prop firms to pay out because profitable traders are far and few, compared to unprofitable traders, who will take challenges out of desperation to make money and not having funded challenge experience will likely lose and this is where the bulk of the money is coming from. Use prop firms as a way to build capital don't rely on them take profits build personal account, but don't fear prop firms they are there to help pro traders make money. Learn to trade first before attempting a challenge or succumb to failure.

Use the profits you make from prop firms to start your own account with your own money! Funded account changed my life

End ,Thanks Nick i always thought to myself that Prop Firms were sketchy 😅you just shined the light my way..

Yeah I notice taking the challenges, that your profit loss is not what you think it would be. For instance, a .10 lot. You could be up 1000 points however, your account is only up say $67 give or take. They can have "THE BEST SPREADS" all they want. They make money in different ways. I will note that in drawdown the same applies. You're not down as much. Another word of advice. During backtesting I've noticed the end of the year or beginning yeild better price trending. So passing the difficult phase 1 on most firms may be easier during these times. Not advise, just a friendly observation. Thank you all and good luck!

I’ve seen videos posted from people that won challenges employing horrible risk management. I suspect this is the case with several if not most of those that beat challenges. Add that to these services that beat challenges for a contestant… for the firm to do anything but b booking until history is established would be a terrible idea.

Oh no. Don't bring up Funding Talent. That's wrong 😂

I agree with you 😊 very genuine 👍🏻 and educational ... Untill & unless we are profitable we have nothing to do with the prop firms 💯 % ✔️

I know all this, I thought there was a new company called buble, just watched this on my whole lunch break 😒

If you can trade and have good risk management, no B book can stop y being profitable, but saying that best to take profits and build your personal account with prop profits and no they are not all B booking you.

END. Is there any way to find out if a prop firm really funds anyone or if they just pay the "funded" traders out of the money that they take in on the sim side? Is this business regulated?

As a funded trader with a prop firm, I have personally experienced consistent monthly returns of around 2% while maintaining low drawdown levels (0.1 - 0.2%). Regarding the practice of b-booking, it is true that some prop firms may initially evaluate traders' behavior and use revenue from challenges to pay profitable traders. However, as prop firms evolve, they establish a core group of systematically profitable traders who consistently achieve 1-2% returns while keeping drawdown low. These prop firms do not engage in b-booking with such traders and can compensate them from the trading results. It is important to note that serious prop firms typically do not tolerate trading strategies that rely on capturing a few pips here and there, as they are not feasible to replicate in the real market.

Lux Trading Firm is the only firm I know who's using A-Book and NOT B-Book

Made it to the end. I am practicing on Oanda DEMO mode to pass the Funder Pro challenge (best prop firm I've found - real funds, real market). It is certainly not easy. I've studied and practiced intensely for 4 months and am just now beginning to KNOW I am progressing. Take your time and prove your skill to yourself until you KNOW you can consistently, profitably trade. Beat your ego self and you will become a profitable trader. That's what I have discovered.

Great eye opener. Thanks Nick.. love from Ghana 🇬🇭 West Africa 🌍

End ❤. This content has been an eye opener Nick 🔥

City traders imperium and 5ers have been around since like 2016… they’re the real legit prop firms. It comes down to can you identifying which firms want to make money from profitable traders and which want you to fail to make money from challenges. Let’s be honest. If you B book all your traders and suddenly you have too many profitable traders. Because you’re not going to the live market with their orders you’re gunna go broke with payouts.

END. Thank you Sir Nick! Very practical advise. Keep it coming. GOD BLESS you!

Nick put chart on background, and I couldn’t stop watching and studying it 🤣

Wow!! This is the first time I'm hearing this bitter truth. Thanks boss for opening my eyes 👀

But i found some traders , could payout more than 50.000 for few times, but they still pay it on time, even they create VIP program so traders can withdraw anytime... If they want us lose, they wont create that program... Are they move the trader who join vip program to A-book?

This wasn't an advertisement for finding Talent

I started lookingn into prop firms yesterday. I've been trading since May of last year and my demo account is profitable. My experience is trading large and small cap stocks going long and short. Aren't prop firms generally marketed towards forex traders? I don't want to sign up for one and then discover that I can't short or trade pre-market. I'd rather just stick with my 3 trades per week.

End. Appreciate the transparency 💯

End. Thank you so much for this!

END. Thank you Nick for sharing your POV on prop firms, I've been consistently making 1-2% and losing less than I make, I will start looking for trusted prop forms with 6 month challenges once i finalize my economic studies. Great video! 💯

END. Thank you so much for the insights. You confirmed alot of what I was feeling. Probably why I was so hesitant to get started with the prop firm I was considering. Definitely makes sense....I'll just use the funds I have and build from there.

It’s very simple, you’re paying for the opportunity to trade with much larger capital than what you otherwise would be able to… If you can trade you get paid, if you can’t trade then you pay. Prop firms are a great opportunity, just get them skills tight first, to many fall for the shiny object before they’re ready… (and I’m not exempt from that). Trust it’s not the prop firm it’s the trader.

Correct if I'm wrong but of course they make money on the challenge fees and the high failure rate with inexperienced traders but I've been told that they do copy trades if certain conditions are met but I don't know how accurate this is

There's a psychological issue with 1-2% a month on prop firms. It takes incredible discipline to be forced to make 10% then 5% on most prop firm challenges in a month's time then go all the way down to 1% a month. Most people wanna make more than what was required to get funded. Even the scaling plans require 10% growth over 4 months. Thats 2.5% a month.

END, thanks you for the insight as a new rader it veryeasy to get sucked up in this industry especially since many trader being on youtube are talking about managing million i prop money its easy to get hooked up. thank you for the education and i willl take your advice and assess my result after a year + and decide if prop is the way to go.

This is great information, thanks Nick.

I liked the information you gave and advices Nick thank you 🙏

I agree with some of your words, but most of profitable traders have blown up several accounts to become profitable, dont you think its better to blow up some prop firm accounts worth less than 200 usd than lossing your 1000usd until you become a profitable trader. Because you treat prop firm as real account as you've paid for it. Because you cant be a profitable trader until you trade a real account.

When i asked that prop firms giving you demo account how are you make profit while you give me 80% of that funded demo account? Their respond was we have live accounts we filter the successful trades then we do it on our live accounts!🤔 .....do you think they are or not...?

With the edge finder, I’m a prop firms worst nightmare

Prop firms are like gas stations now

I had a 200k funded account. I took a large position and the market took off running. My platform froze. I was probably 40k in profits. Market came back 3 hours later to my entry point and they unfroze my account. Apparently they B booked me and I took them for a ride loll.

End. Agree w your conclusion, but think even an ethical prop firm should b book new funded traders to establish history in the same way you suggested a trader should establish their own history before beginning a challenge. In short your suggestion applies to both t and T.

End of the day a business model is a business model … Life’s not meant to be fair at the bottom of the ladder and even when your at the top life don’t get easier . We all gotta survive some way right 😙😙

That’s not what arbitrage is.

End.😂This information is vital.I love it. It make so sense.

You guys are looking at this all wrong. I would rather spend 75$ a month for access to Ninjatrader platform and a demo account so i can learn to be a professional trader than to lose thousands trying to figure it out with my own money. A 4 year college degree costs around $40,000. 4 years at 75$ a month is $3000. Well worth it to learn a new trade. Just paying for Ninjatrader and data feed on my own is $120 a month easily.

"End". No every prop firm does that. In the case of City Traders Imperium, they fund you with real money from the start. And they have serious good traders that makes serious money consistently. Problem still is that most that fail challenges are the ones that still loses money with brokerage accounts: new traders that don't know how to trade. And in the case of the ones that give you demo accounts when you are funded (I'm funded with MFF, which is a demo account connect to their master account), if you really are a profitable and consistent trader, they would copy your trades and, in the case you are a monster trader that is consistent day in-day out; they made money from your trades in their institutional accounts. So, prop firms earn their money in a win-win situation from: new traders that blow demo challenge and professional traders that help them grow their institutional account's. Few retail traders that have the struck of luck of passing the account and having a withdrawal will have money that the prop firm haven't made and comes from their pockets.

I'm still a student and my capital is just 500 i ear like 50 to 70usd per day 20 to 35usd. This is exactly what i needed

"END" However thanks, its been a great video.😊

Very big Truth : Prop firms for consistent profitable traders . Thanks Nick

End. I like your honesty, mentioning certain companies are incentivized when you fail.

NOW NICK...TELL ME WHATS THE FUTURE OF US RETAIL TRADERS WHO ONLY HAVING A 1000 DOLLAR ACCOUNT TO TRADE AND CANT ARRANGE MORE MONEY FOR THE ACCOUNT...IF WE MAKE 2% ON 1000 USD ACCOUNT THATS 20 USD PROFIT WHICH IS NOT EVEN CLOSE TO MY INTERNET BILL....2% IS NOT EVER A MONTHLY TARGET OF ANY PROP FIRM..SO WHATS THE FUTURE FOR US RETAIL TRADERS...DO YOU HAVE ANY THOUGHTS...????

Somebody watched coffeezilla 😅😅

"They are not going to make the money from the 10%. That's laughable." Why? Are you saying that copy trading doesn't exist? Why would they choose to leverage at exactly 1X when they can leverage their most profitable traders at 1.3X and their riskiest traders at .7X?

End. Thanks Nick, honest and insightful as always.

90% 10% split is a good profit for them - they have 10% of whatever capital they have out in the market which is relative to their other income, to me they look like they win both ways

End. Great. I would highly appreciate if we can talk more about this subject. 🙏

I keep pausing the video to do analysis thanks Nick ❤😂

End, lol, that being said, yeah prop firms are a double edged sword indeed, they are a treasure for someone like me in a 3rd world country who wants to finish residency abroad, yet passing those challanges with all the pesky rules is a real pain, u re basically required to make double the drawdown amount, which is like indirectly telling you u have to double your account size in a month.

End..thank you for your honesty 😊

Great information. Thank you!

*END* I appreciate this _so very muc;,_ thank you, Nick.

End. I'm still a learning trader trying to make it in the market and when I'm finally ready, I wish to go the prop firm route. It will serve as a great opportunity for me as I live in South Africa and the exchange rate against the dollar at this current period is crazy high! 1-2% honestly would mean more than enough money for me.

End! Thank you for this information

END. Very informative video. Thx!

This concept is applied only to the H1 chart, after that they can't put trade against you even if they do that can bring chaos for the specific asset so my advice here is always do your analysis from H4. Most of the traders that lose money are trading in m5 m15 m30 and h1 because these frames are noisy and easily breakable making new highs and lows although h4 is hard to break on 1st attempt so still the trader has the room to make some profits.

End. Thanks for this very informative video. I got into this shaddy game of one of the prop firms. I was profitable at the expiry of the 30days limit but was penalised for over trading because I traded on the 31st day when the platform was left open. This was a trap to disqualify me because this was obviously not one of their rules. That's why I won't trade with a broker who is not an ECN broker. It is like pouring water into a basket.

End. That was very humble and helpful!!