Trade with a broker and be 20.000€ richer at the end of the trading year*
Why you should trade with a broker instead of a prop firm?
I am giving you 3 good reasons
Be a Profitable Trader faster
It is far easier to be a profitable trader with a broker
A Broker Is A Bank
A broker is a bank. There are no issues with pay outs
Make More Money
There is no profit share. You make more money
When you trade with a prop firm it is against the business interest of the prop firm that you win the challenge
Winning traders cost the prop firm money
When you trade with a prop firm, it is against the business interest of the prop firm that you actually win the challenge. So they put obstacles in place in form of rules that make your life unnecessary hard.
Brokers want that you trade and win
Brokers, unless you really trade institutional size, make money from the bid ask commission (aka spread) or other fees that traders need to pay to put on a trade.
What Is A Prop Firm?
Unlike brokers, prop firms are unregulated “trader evaluation firms”
It’s a genius business idea. Instead of letting traders trade real money in the actual markets, you simply let them do their thing in a simulated environment. Prop firm trading is demo trading. You know retail traders will lose money with a high probability. You can simply put more “rules” in place to move that percentage more in your favor. So it will be almost impossible for the trader to pass.
And the very few who do will simply be paid out of the pot of challenge fees of the unsuccessful.
I am not saying that reputable prop firms like FTMO are doing this, but there are some black sheep out there who push the envelope further.
Since prop firms are not regulated, prop firms can create spikes on the chart (it is a simulated trading environment) or slippage. And if everything else does not work, deny payouts
When you trade with a broker, there is no profit share
Let me show you a concrete example why a trader using a broker instead of prop firm can have more than 20.000€ more in his bank account.
*Peter and Andi both trade the DAX and fire 10 trades per day at 5 Euros a point. Both risk 150€ per trade. Both go for a risk-to-reward-ratio of 1:1 (once the trade is 150€ in profit, they close it or otherwise get stopped out and lose 150€). They both have a win-rate of 60% and trade 250 days per year
Peter buys a 50K FTMO challenge for 350€
Peter risks 3% per trade. “But Andi, it is a 50K account!”- No. The maximum drawdown that Peter is allowed to experience is 5K. Then 5K is his actual account size. The above parameters apply
Winners: 150€ * 6 winners = 900€
Losers: 150€ * 4 losers = 600€
Profit per day = 300€
Profit per year = 300€ * 250 days = 75.000€
Deductions
20% profit share = 15.000€
Challenge Phase 1 = 5.000€ (not eligible for payout)
Challenge Phase 2 = 2.500€ (not eligible for payout)
Profit per year after deduction = 52.500€
Andi deposits 5K in a broker account
Andi also risks 3% per trade = 350€. The above parameters apply.
Winners: 150€ * 6 winners = 900€
Losers: 150€ * 4 losers = 600€
Profit per day = 300€
Profit per year = 300€ * 250 days = 75.000€
No deductions.
Andi makes 22.500€ more!
I recently partnered with the broker that I trade with for many years now: TD365.
They offer the lowest FIXED spreads in the industry! If you want to sign up with them, please consider using the following affiliate link: https://go.td365.com/visit/?bta=35371&brand=td365
At no extra cost to you I will receive a small commission that will help create more content.