A prop firm account, also referred to as a funded account, is a trading account that contains the firm’s capital and is assigned to a trader who has successfully completed the evaluation process. Account sizes vary by firm and program, typically ranging from $10,000 to $400,000 or more.

Once a trader has a funded account, they trade according to the firm’s rules and receive a percentage of any profits they generate. This profit share is commonly between 70 and 90 percent in the trader’s favor. The firm retains the remaining share as its return for providing the capital and taking on the financial risk.

It is important to understand whether a funded account operates on a live basis, meaning real orders are placed in actual markets, or on a simulated basis, where market conditions are replicated using virtual capital. Both models are used across the industry. Knowing which type applies to your account will give you a clearer understanding of how your profits are calculated and how payouts are funded.