A prop firm evaluation is a paid trading challenge where you trade a simulated demo account to specific profit and risk targets within a time window; pass it, and the firm allocates you a real or simulated funded account where you keep a percentage of the profits. It is the dominant funded-trader model of the last five years and a different beast from a one-shot championship: instead of competing for a fixed prize, you compete against the rules.
This guide covers how evaluations actually work, what the major firms offer, the rules that quietly disqualify most entrants, and how an evaluation differs from a traditional trading tournament.
The basic structure
Every evaluation has the same five components. The numbers differ by firm; the structure is universal.
- Account size. The notional capital you're trading. Common tiers: $10K, $25K, $50K, $100K, $200K, $300K. The fee you pay scales with the size.
- Profit target. A percentage of the account you must reach to pass — typically 8–10% in single-step evaluations, 10% then 5% across two phases in two-step evaluations.
- Drawdown limits. Two separate limits: a daily loss cap (often 5% of account) and a total loss cap (often 8–10% of account). Hit either, and the evaluation ends.
- Time limit. The window in which to hit the target. Often 30 days for the first phase, 60 for the second; some firms now offer unlimited time on certain plans.
- Profit split. What percentage of profits you keep once funded. Industry range: 70–100% on the first scaling tier, often increasing toward 90% as you scale.
Pay the fee, trade the demo account to target inside the limits, and you're funded. That's the loop. The fee is what the firm earns on traders who don't make it; the profit split is what they earn on traders who do.
How the major firms structure it
The four most-cited prop firms accepting public retail traders in 2026:
FTMO
Two-step evaluation. The first phase requires a 10% profit target within 30 days while keeping daily losses under 5% and total drawdown under 10%. The second (Verification) phase is 60 days with a 5% target and the same risk limits. Account sizes range from $10,000 to $200,000. Profit split starts at 80% and scales toward 90% with continued performance. Forex, indices, commodities, crypto. The most established brand in the segment.
Topstep
Single-step "Trading Combine" evaluation focused on futures (E-mini S&P, Nasdaq, oil, gold). Profit split is 100% on the first $10,000 in payouts then 90% thereafter — best first-payout rate in the segment. Trailing drawdown is the standout (and toughest) feature: the drawdown floor moves up with your account high and never moves back down, so a strong day followed by a pullback can erase your buffer even if you stayed in profit.
Apex Trader Funding
Single-step evaluation with $25K to $300K futures accounts. Profit split: 100% on the first $25,000 in cumulative profits, then 90%. Like Topstep, the trailing drawdown follows the equity high and doesn't reset down — one of the structurally strictest risk rules in the segment. Cheap entry fees relative to peers, with frequent discount cycles.
FundedNext
Two-step evaluation with profit targets in line with FTMO (8–10% phase one, 5% phase two), competitive split structure (typically 80% scaling up), and a wider asset range than the futures-only firms. Strong recent growth and active in markets where FTMO has historically dominated.
MyForexFunds (status note)
MyForexFunds was a major prop firm before being shut down by the CFTC in September 2023. The CFTC's case was later dismissed (May 2025) due to procedural errors on the regulator's side, but the firm has not resumed retail operations as of writing. Mentioning it for completeness: it appears in older comparison articles but should not be treated as a currently active option.
The rule that disqualifies most evaluations
Across all firms, the single most common evaluation failure is breaching the daily loss limit on a normal trading day. The math is unintuitive: a 5% daily loss limit on a $50,000 account is $2,500 — easy to hit on a normal-volatility instrument with two leveraged positions in the wrong direction. Traders accustomed to risking 1–2% per position often size up for the evaluation in pursuit of the profit target, then breach the daily limit before they get there.
Other common breaches:
- Trailing drawdown (Topstep, Apex). Most retail traders model "drawdown" as a fixed dollar amount; trailing drawdown is dynamic and ratchets up. Following one good day, the floor moves up, and a normal pullback can hit the new floor.
- News-trade prohibitions. Many firms ban holding positions through high-impact news releases (NFP, FOMC). Forgetting and getting stopped out can disqualify regardless of P&L.
- Maximum lot size / position size limits. Some firms cap the position size you can take regardless of account equity. Hitting the cap can disqualify or void the trade.
- Minimum trading days. Some evaluations require trading on at least N distinct days inside the window. Hitting the target on day three doesn't pass if minimum is 10.
- Consistency rules. "No single day can produce more than X% of total profit." Designed to penalize traders who hit the target via one home-run trade. Common in second phases of two-step evaluations.
Read the full rule set before paying. The fee is the entry cost; the rule violations are the actual exit.
Evaluation vs traditional tournament
A trading tournament and a prop firm evaluation share the structure of "trade to a metric in a time window," but they differ on five axes:
| Traditional tournament | Prop firm evaluation | |
|---|---|---|
| Goal | Win a prize / placement | Pass to get funded |
| Reward | Fixed prize pool, finite | Profit split, ongoing if maintained |
| Failure mode | Lose the prize | Lose the fee, can re-enter |
| Outcome | Once-and-done | Ongoing relationship with the firm |
| Verification | Public leaderboard | Private account; firm verifies |
A trader looking for a one-time win and a public credential should enter a championship (WCTC, USIC) — where the leaderboard is public and a placement enters a recordable canon. A trader looking for ongoing capital allocation and a steady income stream should enter prop firm evaluations — where the goal is the funded account, not the title. Different incentives, different optimal strategies.
When an evaluation is worth the fee
The economics: pay $X for a chance at an account of size N, with edge probability P of passing, and an expected value E from each successful funded period.
- $X = evaluation fee (refundable on first profit cycle from many firms)
- N = funded account size
- P = your honest probability of passing within the rules
- E = expected lifetime profits from a passed account, accounting for funded-account washouts
Evaluation fees vary from ~$50 (smallest tier on aggressive firms) to $1,000+ (largest tier). Funded accounts churn fast — the median funded trader does not last 6 months without breaching a rule. So the EV calculation hinges hard on P (probability of passing) and average funded lifespan.
A trader with a backtested edge of >1.5 Sharpe on the firm's allowed instruments, who has practiced the firm's specific drawdown rule, and who has a clear strategy for hitting the profit target without exceeding daily loss — has a viable EV. A trader who has never operated under tight intraday risk limits is likely paying the fee as marketing for the firm. Be honest about which you are.
What we list at trading-tournaments.com
We treat funded-trader evaluations as a distinct asset class in the tournaments catalog with the prop_firm filter. Where they overlap with traditional tournaments — for example, prop firms running championship events — they appear in both. Browse the free-entry filter for occasional fee-free promotions; most evaluations are paid entry by design.
For prop-firm-specific T&C reading guidance, the companion piece How to read a prize structure covers the clauses that apply across both tournament and evaluation formats.
Frequently asked questions
What's the difference between a one-step and a two-step evaluation? A one-step evaluation requires hitting a single profit target inside a single time window. Two-step evaluations split it into a higher first-phase target and a lower second-phase target across two windows, with the second phase usually longer. Two-step is the FTMO standard; one-step is more common at futures-focused firms (Topstep, Apex) and at newer challengers offering simpler products. The two-step is harder to pass overall but rewards more measured trading; the one-step rewards faster execution.
Is an "evaluation account" real money or simulated? Almost universally simulated during the evaluation phase. After passing, some firms operate a similarly simulated funded account with payouts coming from the firm's own capital (this is the dominant retail-prop-firm model — sometimes called "simulated funded" or "demo-funded"). A few firms use actual live exchange capital after evaluation. Read each firm's specific terms; the legal structure varies.
Can I withdraw the profit immediately on passing? No. Profit can only be withdrawn after passing the evaluation, being onboarded onto the funded account, executing trades on the funded account, and then requesting a payout per the firm's payout cycle (typically monthly or every two weeks, sometimes after a minimum trading days requirement on the funded account).
Why do most traders fail prop firm evaluations? The intersection of profit target and daily loss limit. To hit a 10% target inside 30 days, traders size up positions; the larger size means a normal volatile day can hit the 5% daily loss cap. Most failures aren't from a strategy that doesn't work — they're from sizing the working strategy too aggressively to meet the time window.
Is the fee refundable? Typically yes, on first profit cycle. Most major firms refund the evaluation fee with the first payout from the funded account. If you fail, the fee is the firm's revenue. This makes the firm's economics work: many entrants pay fees, fewer pass, even fewer remain funded long enough to be net-positive — and the fees from the failures fund the payouts of the successes.
Last reviewed 2026-05-09 by Eugene Loza. Submit corrections via the Suggest a change form.