Prop / Funded · Module C1
It isn't a job, and it isn't your own account. It's an evaluation you pay to attempt — and knowing that changes everything about how you read the offer.
What you'll learn
The thing itself
A funded account — sometimes called a prop account, a challenge, or an evaluation — is a product you buy. You pay a fee, you're given an account with a target and a set of rules, and if you hit the target without breaking a rule, the firm gives you a larger account to trade and a share of the profits you make on it.
That sounds like getting a job as a trader. It isn't. When a real firm hires a trader, the trader is an employee, trades the firm's actual money, and is paid whether or not the firm sells anything. A funded account inverts all three: you are a customer, not an employee; the money you trade during the evaluation is almost always simulated; and the firm's product is the evaluation itself. You didn't get hired. You bought an attempt.
This isn't a criticism — it's just the accurate description, and most of the confusion around funded accounts comes from people picturing the first thing while buying the second. Get the description right and the rest of this path follows cleanly.
The lifecycle
Every funded account, whatever the firm calls it, runs the same four stages:
The evaluation lifecycle
Notice what's missing from that chain: at no point are you guaranteed to ever touch real money or real markets. Whether you do depends entirely on the firm's model — and that distinction is large enough that it gets its own module. For now, hold the shape: you pay for an attempt, you pass an evaluation, you trade a funded account, you withdraw a split.
A word that means two things
Proprietary trading is decades old. A proprietary trading firm trades its own capital — through hired traders, for the firm's own account. Bank prop desks, independent futures and options arcades, market-making shops: the trader is recruited against a skill bar, paid a salary or a draw against profit, and trades the firm's real money in live markets. The firm's revenue is the market profit those traders generate. There is no fee, because the firm isn't selling anything to the trader — it's employing one.
The retail "prop account" model is barely ten to fifteen years old and shares almost nothing with that except the word. Here the trader pays a fee, usually trades simulated capital, and — for many firms — the firm's revenue is the fees themselves rather than market profit. The trader is a customer, not an employee.
So when you see "prop firm," ask which one is meant. The original sells nothing to the trader and profits from the market. The retail model sells attempts to the trader and often profits from the attempts. They are different businesses wearing the same name — and that difference is the seed of the conflict-of-interest question this path takes apart later.
The original thing — you'll hear it called
The retail thing — you'll hear it called
Whichever term you arrived with, it lands in one of those two columns. The rest of this path is about the right-hand one — but knowing the left exists is what stops the marketing word "prop" from doing your thinking for you.
Three ways to hold a position
The clearest way to understand a funded account is to put it beside the alternatives. There are three distinct ways a retail trader can take a position in gold — and they differ on who owns the risk, who owns the upside, and who writes the rules.
Your own live account
Total freedom, total risk. The market is your only constraint.
Prop evaluation account
Limited downside, but you hand the firm a rulebook over how you trade.
Prop funded account
Leverage without personal downside beyond the fee — in exchange for a cut of your upside and a rulebook.
None of these is "better." They're different instruments for different situations. If your binding constraint is capital — you can trade but don't have a stake to trade — the prop route lets you control size you couldn't otherwise reach, and caps your personal downside at the fee. If your binding constraint is nothing but your own skill and you have capital to risk, your own account gives you total freedom and keeps 100% of the upside. The funded route is a trade: someone else's size and capped personal downside, in exchange for a rulebook and a share of what you make.
Which constraint is actually yours is the question to answer before you ever buy an evaluation. The rest of this path arms you to answer it honestly.
Carry this into C2