How To Get A Funded Trading Account? An Expert Guide

Any ambitious Forex trader would find it alluring to become a funded trader. Although it could appear like a simple approach to get access to more trading funds, in reality, earning funded status requires persistence and great trading skills.

Nowadays, funded trading accounts have become the most creative option we ever had a decade ago. With such accounts, you have a chance to start your trading journey, develop your trading prospectus and achieve your financial potential without the worry of losses or paying any upfront costs.

But how to get a funded trading account? This article covers the step-by-step process of acquiring a funded trading account. Keep reading.

What's A Funded Trading Account?

A funded trading account is an account backed by a third-party firm offering the required funds for traders. This will allow them to trade and, in return, receive an agreed percentage of the profit. This will enable the trader's access to the financial resources required without worrying about how to acquire trading capital. The funded accounts allow traders to overcome the challenges of trading, such as initial capital required, brokerage fees, and software subscription fees.

Funded accounts are essential for many professional traders to survive and thrive in the markets. For any professional trader, having a funded trading account is an invaluable asset, whether they use it as their primary or secondary source of equity. A company that trades on behalf of third-party traders is known as a proprietary trading firm or prop firm. So, how to get a funded trading account? The next part shows you how.

Steps Of Acquiring A Funded Trading Account

Before selecting any funded trading account, it's good to consider its reliability, available leverage, supported platforms, and profit share. The following are steps on how to get a funded trading account.

• Choosing a platform

  The first step on how to get a funded trading account is to select the right platform. Look for a platform offering funded trading accounts. This enables the trader to have an in-depth knowledge of the trading firm and its terms of service. During the research, a trader should answer the following questions:

  1. Does the platform provide real trading capital? - The greatest reason for choosing a funded account is for the trader to get capital to enable him/her to undertake the trading activity. It is, therefore, important to establish whether the firm provides real trading capital.
  2. Does it have a great reputation – Check the opinion of others on the firm. Are they trustworthy and reliable, and do they abide by their terms?
  3. Are there any withdrawal proofs? – Make sure you check the proof of how they withdraw the money. Check what the previous traders say.
  4. Is capital scaling offered? – Find if they offer traders the ability to grow without being hampered. This helps in smooth operations and growing without restrictions.
  5. What are the rules for the prop firm? – Check on the rules and terms of the trade funding firm and see if you can abide by them. Are the rules strict or lenient?

• Application process

  After you've settled on the right platform, now you can apply for a funded trading account. This typically involves filling out an online application form and verifying your identity and trading experience by providing the required documents.

• Evaluation process

  To prove your trading experience and abilities some platforms may demand a trader to undertake a simulated trading or complete a certain task. This allows the firm to see the trading ability and risk management of the traders.

• Funding criteria

  Upon successful passing of the evaluation process, the firm goes ahead to provide a platform with a funded trading account and an agreed share of the profit with them. Terms and conditions – Before engaging in trading, you should agree with the firm on trading terms and conditions such as profit-sharing portion, terms governing trading activities, and rules on risk management, then sign the legal document.

• Start trading

  After getting the funded account and having understood the rules and terms of trading, you can now start trading. Before you start trading, it is good to make sure that:

  1. You understand the Markets – Every successful trader needs knowledge of the market, that is, how it functions. It involves understanding the simple as well as the complex details.
  2. Understand the Securities - Stocks, futures, options, and mutual funds all trade differently. Initiating a trading strategy without a clear understanding of the characteristics of security and the trading requirement can lead to failure. Lack of understanding about these securities can lead to losses. Therefore, traders should ensure deep familiarity with the trading of securities selected.
  3. Set up Strategy - Traders entering the trading world may begin by selecting at least two or more already established strategies. The two strategies would act as a backup of each other in case of failure. It's important to note the dynamism of the trading world and, therefore, keep in mind that a trading strategy can consistently make money but fail at one point. You should, therefore, keep a close eye on the trading strategy selected and look for ways to adapt, customize, and substitute it depending on development.

• Abide to the rules

  All trading funding firms have their rules that they require traders to follow. This may involve trading hours, targeted profit, or maximum loss the account can sustain. The rules are meant to provide the sustainability of the account by the trader as well as create harmony between the trader and the firm.

Conclusion

That's all on how to get a funded trading account. When trading in any firm, try not to accumulate a lot of profit, as some companies may not have the capacity for huge payouts. Although many companies claim their sites to have huge payouts, it is always safe to make frequent withdrawals as you give yourself a chance to grow with them. It is also important to note that trading is the same whether funded or using your capital and therefore, it's important to keep guard and not assume the risk involved.