Online prop firms are a great way for traders to scale their capital and increase their profits in the markets without needing to find investors
Online prop firms are a great way for traders to scale their capital and increase their profits in the markets without needing to find investors or compound their accounts for many years.
However, prop firms can be expensive, and not everyone can afford them; furthermore, some traders want to take more than one trading challenge to obtain funding, which can get very pricey! This begs the question, what is the cheapest prop firm?
The cheapest prop firm is The5ers, with a 2-step High Stakes $5000 account, which costs traders just $39, making it the cheapest funding option on the market.
In this article, we’ll explore the 5 cheapest forex prop firms, the cheapest stock prop firm, and the fees you’ll be paying your prop firm. So, let’s get into it!
What Are The Cheapest Prop Firms?
Even consistently profitable traders may need one or two extra prop firm challenges to get funded as the market conditions may not be significant for their trading strategies at the time of their challenge.
Therefore, ensuring you’re working with a cost-effective prop firm will save you a lot of money and headaches and hopefully allow you to take multiple challenges, if needed, to obtain the funding you’re looking for!
The Top 5 Cheapest Forex Prop Firm
We will keep this constantly updated to reflect pricing within the market, but currently, these are the top 5 cheapest prop firms for forex traders:
1. The5ers - $39
The5ers offers the cheapest prop firm challenge in the industry, with high stakes of $5000 in trading capital for just $39. This is the 2-step challenge. The5ers is known for their high reputation and their great trading condition.
2. My Funded FX - $49
My Funded FX offers the next cheapest prop firm challenge at just $50 for $5,000 in trading capital. This is a 2 step challenge account.
3. TheFundedTrader - $65
TheFundedTrader offers a similar evaluation of a $5,000 funding trading account to MyForexFunds, costing $65. This, again, is a 2 step challenge model account.
4. Finotive - $75
Like MyForexFunds and TheFundedTrader, Finotive offers $5,000 funding trading account for just $75. This is another 2 step challenge model account.
5. FXIFY- $75
The last on the list is FXIFY. It is a new kid on the bloc and offers a 2-step $10,000 account with a one-time fee of $75.
The Cheapest Stock Prop Firm
If you prefer trading the stock market, few stock prop firms offer funds, especially for stock traders.
1. Trade The Pool - $97
Trade The Pool is currently the cheapest and best stock prop firm on the market, coming in at just $97 for $20,000 of buying power and great trading conditions. You can trade more than 12,000 stocks and ETFs and even short any penny stock.
The Types Of Fees You Pay To Prop Firms
There are more ways online prop firms charge traders for their service and capital. These include:
1. Trading Challenge Fees
All online prop firms charge traders a fee to take a trading challenge to prove they can consistently and profitably trade the markets. If they’re successful, the trader will be allocated a certain amount of capital to trade with!
2. Performance Fees/Profit Splits
The large majority of online prop firms will offer traders a profit split. The profit split greatly depends on the prop firm you’re working with, but it typically ranges from 50%-90%.
For example, if you were working with a prop firm on a 90% split and made a $10,000 profit that month, you’d keep $9000, and the prop firm would take $1000.
3. Trading Conditions (Spreads, Commissions, and Slippage)
Prop firms will charge you a spread and/or commissions for your trades within the market, precisely as a forex broker would. This is an ultimate standard within the industry, and it’s usually negligible compared to your trading profits unless you’re a high-frequency trader/scalper.
4. Monthly Account Fees
Some prop firms charge a monthly fee to keep your funded trading account. We’ve seen this model slowly dying out over the last 6-12 months, but looking back 2-3 years, this was the most popular model!
Comparing Costs & Benefits
Now we have identified the 5 cheapest forex prop firms, let’s take a deeper look at their offerings to guide your decision as to which firm may be right for you!
Tips for Choosing the Right Prop Firm
Just because a funded trading account might seem great or a prop firm is affordable - this doesn’t mean they’re the right prop firm for you!
You should consider several factors when choosing the right prop firm to work with. These factors include:
1. The Reputation
With prop firms popping up daily, working with a prop firm with a long-term, established reputation in the industry is crucial. The better the reputation, the less likely the prop firm will go bust overnight, leaving you high and dry with no funding!
For reference, The5%ers has over 1300 reviews on Trustpilot, rated 4.8/5!
2. Affordability
Affordability and pricing play a big factor. If you’re coming into the markets with just $500, you don’t want to work with a prop firm that charges $500 for a challenge account.
Working with a much more affordable option would be more suitable because if you fail the challenge, you'll want to have the opportunity for a second chance.
3. Support for Traders
It’s important to consider what kind of support traders are offered by a prop firm. Are they offering mentorship, training material, valuable insights, and fast customer support, or are they just leaving traders to fend for themselves using a cheap, outsourced live chat feature?
Believe us, once you’re funded, this will be a big factor for you!
4. Alignment with Your Trading Strategies
The prop firm must align with your trading strategies. For example, some prop firms do not allow traders to hold trades over the weekend. If you’re a swing or position trader, you cannot trade your strategies with that firm effectively.
There are prop firms catered to every trading style, so you need to find the one that best suits your trading style!
5. Capital Scaling Opportunities
It’s important to think long-term. Does the prop firm you’re considering allow traders multiple trading accounts? Are there opportunities to compound your trading account?
Is there a way you can grow your capital (scaling plan) under management without the need to work with an additional prop firm?
These are some of the questions you should be asking.
Speaking of questions, let’s look at some commonly asked questions regarding prop firms.
FAQs
What are the pros of trading with the prop firm?
The main advantage of prop trading is that prop firms pay you to trade, allowing you to make money even if you don't have enough capital. Also, you can't lose any money, except the one you paid for evaluation or instant trading.
How do I become a funded trader?
There are two methods to becoming a funded trader. The most popular approach to pay for an evaluation phase. You have to demonstrate your ability to produce a profit while adhering to the firm's trading guidelines. Once you pass, you will be entitled to up to 90% of all income you generate.
There are also prop firms, such as the 5%ers, that provide instant funding. All you need to do is sign up, pay the price, and begin trading.
How do prop firm evaluations work?
Prop company reviews are often divided into two sections. In the first step, you must demonstrate that you are a profitable trader by meeting a profit goal, often between 6%-10%.
The second step demonstrates that the previous phase was not a fluke, although your profit objectives are often reduced to 5%-6%. You must follow your prop firm's trading guidelines during both periods.
Are funded trader programs legit?
There are several legitimately financed trading programs, beginning with the list we provided above. In the US, prop firm trading is regulated by the CFTC (Commodities and Futures Trading Commission).
In Conclusion - What Is The Cheapest Prop Firm?
In summary, the cheapest prop firm offering is The5ers, which has a $5000 account at just $39. Putting pricing aside, it’s important for traders to look at other aspects of the prop firm they’re looking to work with to establish whether they’re the right fit for them!
Media Information
Name: David
Organization:The5ers
Email: [emailprotected]
Address: 14 Haroshet st, Raanaa, Israel
Disclaimer: This press release is distributed by KISS PR on behalf of The5ers. The information in this press release is for informational purposes only, and does not constitute an offer or solicitation to buy any services mentioned. Views and opinions expressed in this press release are those of The5ers and are not endorsed by KISS PR or other distribution partners. Use of this information should not replace consulting with a professional finance adviser. KISS PR does not accept responsibility for any loss resulting from reliance on the information provided in this release.
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