WHAT IS PROPRIETARY TRADING?

Understand the basics of prop trading and how funded accounts work.

Getting Started Article 1 of 4 Updated Mar 2026

Proprietary trading (prop trading) is when a firm provides capital to traders, allowing them to trade financial markets without risking their own money. Traders keep a share of the profits they generate while the firm absorbs the risk of losses up to defined limits.

How The Prop Pit Works

  1. You sign up and choose a funding path (Evaluation, Straight to Funded, or Straight to Live).
  2. You select your asset class and account size.
  3. You trade using the firm's simulated capital within defined risk parameters.
  4. Profits are split — you keep 90%, the firm retains 10%.
  5. Payouts are processed in as little as 1 hour.

Why Prop Trading?

Prop trading removes the biggest barrier to entry: capital. Instead of needing tens of thousands of dollars to trade futures or stocks effectively, you can access professional-level buying power through a funded account. Your risk is limited to the cost of entry, while your upside scales with your skill.

Note

The Prop Pit provides simulated trading programs for educational and evaluation purposes only. All activity occurs in a simulated environment using virtual funds. Payouts are performance-based rewards and are not derived from live market profits.

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