Retail proprietary trading firms, also known as prop trading firms, give traders the chance to use simulated capital to trade instead of their own. Many traders, especially beginners, look for the cheapest prop firms to start their trading journey with a small initial investment. This guide will cover some of the cheapest prop firms challenge, their features, and how to choose the best one for you. By using these affordable options, traders can gain the experience they need while minimizing risk.
Prop firms offer different benefits, such as providing access to simulated trading capital, educational resources, and guidance from experienced traders. Understanding the details of each firm will help you make the best decision based on your trading style and financial goals. Whether you are just starting or looking to scale up, choosing the right prop firm is crucial to your success.
What Are Proprietary Trading Firms?
Proprietary trading firms (or prop firms) let traders use the firm’s virtual capital to make trades and earn profits. Traders have to pass an evaluation to qualify for a funded account. This allows traders to improve their trading skills for a lesser price than having a personal account, making prop firms a good choice for those who want to grow their trading abilities with small capital.
Funded accounts from prop firms come with specific rules like maximum drawdown limits, which help traders manage risk. This setup benefits both the trader and the firm: the trader gains experience and access to capital, while the firm payout to successful traders.
Prop firms also offer opportunities for traders to learn from others through educational resources and mentoring. Many firms provide platforms like cTrader, giving traders the tools they need to practice and improve. Overall, prop firms are a great way for traders to advance their trading career.
Top 5 Cheapest Prop Firms in 2024
Here are some of the most affordable prop firms for traders:
MyFundedFX
MyFundedFXoffers a $5,000 funded trading account for just $50 with leverage up to 1:100. They use a two-step evaluation process designed to be accessible for beginners with a low initial investment. One of their unique features is the absence of maximum or minimum trading days, allowing traders to proceed at their own pace.
They also offer a scaling plan where a trader’s demo account can be increased by 25% every three months, assuming certain profitability criteria are met. MyFundedFX supports various trading styles, including scalping, swing trading, and martingale strategies.
They provide simulated funds of up to $600,000 for evaluations, and traders can use a wide range of instruments, including forex, indices, crypto, and commodities, making it a versatile choice for those looking to grow their trading experience quickly with minimal upfront costs.
The 5%ers
The 5%ers offer challenges starting at $39 for a $5,000 funded account. They are known for their dynamic scaling plan, which allows traders to grow to large account sizes. The 5%ers support different trading styles, such as swing trading, scalping, and news trading. Their one-step Hyper Growth program is popular, enabling traders to double their account size at each milestone.
The firm allows traders to get paid from the first profit target and does not impose any time limits, providing flexibility for achieving growth milestones. The 5%ers also offer solid risk management tools, guidance, and an active community, helping traders stay focused on their trading objectives and achieve higher funding levels over time.
Goat Funded Trader
Goat Funded Trader provides a $5,000 funded account for $45 with flexible profit targets and a two-step evaluation. This firm focuses on forex trading and supports multiple trading strategies, allowing traders to manage more capital as they succeed. Goat Funded Trader also allows traders to use automated tools and Expert Advisors (EAs), giving them more flexibility in their trading approach. This makes it an appealing choice for traders who prefer a more hands-off strategy.
Limitless Funding
Limitless Funding offers evaluations starting at $42, with up to 90% profit splits and no daily drawdown limits, creating a supportive environment for traders. Limitless Funding allows traders to access large amounts of capital with good profit splits, making it ideal for experienced traders looking for growth. Limitless Funding also provides a range of educational resources and regular webinars, helping traders stay updated on market trends and improve their skills.
PipFarm
PipFarm is a budget-friendly prop firm offering challenges starting at $50 for a $5,000 account. With a range of account sizes, low evaluation fees, and flexible trading conditions, PipFarm makes it easier for traders to access funded accounts without high upfront costs. The firm offers profit splits of up to 95%, allowing traders to retain a significant portion of their earnings as they grow their accounts. They also have a kill switch feature that protects traders from breaching the daily drawdown limit.
PipFarm supports different trading styles, including swing trading, scalping, and news trading, providing flexibility for traders to apply their preferred strategies. With a focus on simplicity and affordability, PipFarm is a great option for those looking for a cheap prop firm to kick-start their trading career. They currently offer discounts when you join their email list.
Trading Strategies to Succeed with Prop Firms
To succeed in a prop firm evaluation, traders need good trading strategies. These strategies include swing trading, scalping, and using automated trading tools like Expert Advisors (EAs). A successful strategy should include risk management and be adaptable, allowing traders to meet profit targets without breaking drawdown limits.
Trading styles, such as news trading or different trading approaches, can be helpful when taking on challenges from prop trading firms. Choosing the right trading style can have a big impact on a trader’s career. Swing trading, for example, involves holding positions for several days to take advantage of price swings, while scalping involves making many small trades to profit from minor price changes. Traders should choose a style that fits their personality, risk tolerance, and schedule.
Prop firms often require traders to demonstrate consistency in their trading strategy. Developing a well-defined trading plan and sticking to it is crucial. Traders should also focus on risk management, such as setting stop-loss orders and keeping their risk per trade low, to avoid large losses that could end their evaluation prematurely.
Key Features to Consider When Choosing a Prop Firm
When picking a prop firm, traders should consider important features like evaluation fees, profit splits, leverage, trading platforms, and scaling plans. Evaluation fees can vary a lot, so choosing a firm with reasonable fees is important to keep costs low.
Additionally, it’s important to assess the firm’s sustainability and reliability, ensuring that they have a good track record of timely payouts. PipFarm, for instance, has a payout protection feature that no other firm in the industry offers, providing peace of mind to traders about the reliability of their earnings.
Firms like Limitless Funding and The 5%ers have unique features like static drawdowns and scaling plans, allowing traders to access larger amounts of capital over time. A static drawdown means the drawdown limit does not decrease as the trader makes profits, providing more flexibility for traders to manage their risk effectively.
Traders should also look for firms that offer educational resources to improve their trading skills, especially those who are new to forex trading. Some firms provide free access to training materials, webinars, and one-on-one mentoring to help traders succeed. These resources can make a big difference in a trader’s ability to pass the evaluation and get funded.
Another feature to consider is the trading platform offered by the firm. Platforms like cTrader, MetaTrader 4 or 5 are popular because they are user-friendly and offer a range of tools for technical analysis. Some prop firms also provide their own proprietary platforms, which may have additional features or limitations. Understanding the platform options and choosing one that suits your trading style is essential for success.
Benefits and Features of Popular Trading Platforms
Platforms like cTrader, MetaTrader 4 (MT4), and MetaTrader 5 (MT5) are widely used due to their user-friendly interfaces and comprehensive tools for technical analysis:
-
cTrader: cTrader is known for its advanced charting features, fast trade execution, and customizable layouts. It is ideal for traders who want a more visually oriented interface and prefer a variety of order types. It also supports automated trading through cAlgo, making it an excellent choice for those interested in algorithmic trading.
-
MetaTrader 4 (MT4): MT4 is popular for its simplicity and versatility. It provides access to a wide range of technical indicators, expert advisors (EAs) for automated trading, and supports multiple order types. MT4’s stability and ease of use make it a go-to choice for both beginners and experienced traders.
-
MetaTrader 5 (MT5): MT5 is the successor to MT4 and offers enhanced features, including more timeframes, additional order types, and an economic calendar for fundamental analysis. It is well-suited for traders looking for an all-in-one platform that integrates both technical and fundamental trading tools.
Some prop firms also provide their own proprietary platforms, which may have additional features or limitations. Proprietary platforms can offer unique tools or tailored trading conditions, but they may lack the widespread community support available for platforms like MT4, MT5, or cTrader.
Choosing a platform that aligns with your trading strategies and preferences is crucial for achieving consistent success.
Benefits of Using the Cheapest Prop Trading Firms
Using affordable prop firms can be helpful for new traders who want to gain trading experience with less risk. By choosing cheap prop firms, traders can get funded accounts with low challenge fees and build their confidence. These firms provide a great opportunity for traders to learn and grow without risking large amounts of their own money.
Firms like MyFundedFX and The 5%ers offer affordable evaluation accounts and allow traders to access larger capital if they pass the evaluations, making them great for beginners and retail traders. Additionally, these firms often provide a supportive trading environment, including risk management tools, educational resources, and community support, all of which help traders improve their skills and increase their chances of success.
Choosing a cheap prop firm also allows traders to test different trading strategies and find what works best for them. Since the financial risk is lower, traders can experiment and learn without the pressure of losing significant personal capital. This experience can be invaluable when moving on to larger trading accounts or more challenging evaluations.
Finding the Right Prop Firm for You
Choosing the right prop firm depends on your trading style, risk tolerance, and experience level. Whether you are a beginner looking for a cheap prop firm challenge or an experienced trader seeking a large account with good profit splits, it’s important to carefully evaluate the offerings and fees of each firm.
Look for the cheapest prop firm challenge that matches your trading strategy and provide a supportive environment to help you succeed in your trading journey. Consider factors like evaluation fees, profit splits, educational resources, and trading platforms when making your choice. With the right prop firm, you can gain valuable experience, grow your trading skills, and achieve your financial goals in the world of proprietary trading.