Prop Firm Calculator

A proprietary trading firm (prop firm) gives you access to funded trading capital after you pass an evaluation challenge. Instead of risking your own money, you trade the firm's capital and typically keep 70-90% of the profits. Popular prop firms include FTMO, MyForexFunds, The Funded Trader, and TopStep. You pay a one-time fee for the challenge, and if you meet the profit target while respecting risk limits, you receive a funded account. Learn the basics in our guide on what a prop firm is.

Most prop firms enforce three key rules: a maximum daily loss limit (typically 4-5% of the account), a maximum overall drawdown limit (usually 8-10%), and a minimum profit target to pass the challenge (often 8-10% in Phase 1). Some firms also impose a maximum trailing drawdown that follows your account equity peak. Violating the daily loss limit or max drawdown results in immediate failure of the challenge or loss of your funded account. Our calculator helps you check your trades against these prop firm rules in real time.

The daily loss limit restricts how much your account can lose in a single trading day, typically reset at midnight server time. If you hit this limit, you must stop trading for the day — continuing or trying to recover usually violates the rule. The maximum drawdown is a longer-term limit on total equity decline from your starting balance (or equity peak, depending on the firm). For example, a 5% daily loss limit on a $100,000 account means you can't lose more than $5,000 in one day. A 10% max drawdown means your balance can never fall below $90,000. Use our Drawdown Calculator to understand recovery requirements after drawdowns.

Passing a prop firm challenge requires discipline more than skill. Trade conservatively — aim for 1-2% risk per trade rather than trying to hit the profit target quickly. Use our Lot Size Calculator to size positions that keep you well within daily loss limits. Focus on high-probability setups and avoid overtrading. Keep a trading journal to review your decisions. Most importantly, never move your stop-loss to avoid a loss — protecting capital is more important than any single trade.

If you violate the daily loss limit, your challenge is failed or your funded account is terminated — there are no warnings or second chances in most cases. The same applies to hitting the maximum drawdown threshold. Some firms offer a retry or reset at a discounted price, but you'll need to start over. This is why using a prop firm calculator before and during trading is essential. It helps you know exactly how close you are to the limits so you can make informed decisions. Read our detailed guide on how to pass a prop firm challenge for strategies.

This calculator supports the most common prop firm rule structures, including daily loss limits, maximum drawdown (both balance-based and equity-based), and trailing drawdown. While the specific percentages vary between firms like FTMO, The Funded Trader, Surge Trader, and others, the underlying math is the same. Always double-check your specific firm's exact rules in their documentation, as some have unique provisions like news trading restrictions or weekend holding rules. This tool provides estimates for educational and planning purposes only.

Lot sizing for prop firm accounts should be extremely conservative. A common approach is to risk no more than 0.5-1% per trade on a prop account, compared to 1-2% on a personal account. This gives you multiple losing trades before approaching the daily loss limit. For a $100,000 account with a 5% daily limit ($5,000), risking 1% per trade ($1,000) allows 5 losing trades before hitting the daily limit. Use our Risk Calculator alongside this prop firm calculator to find the right position size for each trade.

Trailing drawdown is a rule used by some prop firms where the maximum drawdown level follows your equity peak upward but never decreases. For example, if your account starts at $100,000 with a 10% trailing drawdown, the floor starts at $90,000. If your equity reaches $105,000, the drawdown floor moves up to $94,500 (10% below the new peak). This means you must keep making new highs to maintain comfortable distance from the limit. This rule is stricter than a fixed drawdown and requires even more disciplined risk management. Always know your current distance from the trailing floor before opening new trades.