Account Size ($)
Profit Target (%)
Max Drawdown (%)
Daily Drawdown (%)
Time Limit (days)
Challenge Fee ($)
Profit Split (%)
Quick presets
Result (click to copy)
Before You Buy a Challenge
Know your drawdown model before you start
This calculator assumes static drawdown (fixed from your initial balance). If your firm uses trailing drawdown instead, your actual floor moves as your equity grows — confirm which model applies before trading.
The daily limit usually kills accounts first
More challenge attempts fail from breaching the daily loss limit in one bad session than from hitting the overall max drawdown — size your per-trade risk against the daily number, not just the total.
The annual payout figure is a ceiling, not a forecast
It assumes you hit the same target every month for a year with no reset — useful for understanding upside potential, not a number to plan your finances around.
How to Use the Prop Firm Challenge Calculator
- Select your firm's preset — click FTMO $100K, MyForexFunds, or FundedNext for instant setup. Or enter your firm's exact rules manually.
- Enter account size — the funded account size you are challenging for (e.g. $10,000, $50,000, or $200,000).
- Set profit target — the percentage profit required to pass (usually 8–10%). FTMO Phase 1 = 10%, Phase 2 = 5%. Most firms use 8–10%.
- Set max drawdown — the maximum total loss allowed from your starting balance (usually 8–12%). Breaching this fails the challenge instantly.
- Set daily drawdown — the maximum you can lose in a single trading day (usually 4–5%). This resets at midnight server time.
- Enter challenge fee — the fee you paid to attempt the challenge. The calculator shows your ROI and projected earnings after passing.
- Review the results — see exactly how much you need to make per day, the maximum you can lose, and your projected annual income from the funded account.
💡 Key insight: The daily drawdown limit is the #1 reason traders fail challenges — not the profit target. A single bad day exceeding 5% ends your challenge regardless of how profitable you were overall. Plan every trading day around the daily limit first.
Understanding Prop Firm Challenge Rules
🎯 Profit Target
The minimum profit percentage required to pass. Usually 8–10% of starting balance. FTMO has a 2-phase system: 10% in Phase 1, 5% in Phase 2. Some firms like The5ers have a single-phase 6% target.
📉 Max Drawdown
The maximum total loss from your initial balance. If a $100K account has a 10% max DD, your balance can never fall below $90,000 — at any point during the challenge, not just at the end.
📅 Daily Drawdown
Maximum loss in one trading day, usually 4–5%. Most firms calculate this from your highest balance of that day (trailing), not from the start of day. A single losing day exceeding this limit immediately fails the challenge.
⏱️ Time Limit
Most firms give 30–60 trading days to hit the target. There is usually no minimum trade requirement, but some firms require a minimum of 4–10 trading days to prevent lucky one-day passes.
💰 Profit Split
After passing and getting funded, you keep 70–90% of profits. FTMO offers up to 90% after scaling. The firm keeps the remainder for providing the capital and absorbing the risk.
🔄 Challenge Fee
The fee paid to attempt the challenge. Many firms refund this fee after your first successful payout. Always check — the refund policy significantly changes the ROI calculation.
The key to passing a prop firm challenge is not just having a profitable strategy — it is having a strategy with controlled drawdowns. A trader who makes consistent 0.5% daily gains will outperform one who swings for 3% days and occasionally loses 4%, even if the average is higher. Consistency and drawdown control are what prop firms actually evaluate.
Why Prop Firm Trading Is a Genuine Opportunity
Prop firm trading has fundamentally changed retail trading. Before prop firms, a skilled trader needed $50,000–$200,000 of their own capital to trade meaningfully. Now, a trader with $500–$1,000 for a challenge fee can manage a $100,000–$200,000 account and keep 80–90% of profits.
The economics make sense
A $550 challenge fee for a $100,000 FTMO account: if you pass and make one 8% profit cycle, your payout is $100,000 × 8% × 80% = $6,400. ROI on the $550 fee = 1,064%. Even if you pass only 1 in 3 attempts, the expected value is strongly positive — provided your strategy genuinely has an edge.
What firms actually want
Prop firms are not trying to prevent you from passing — they make money when you succeed (they take their cut of your profits). What they are filtering out is undisciplined, high-risk traders who would blow accounts. Demonstrate consistent risk management and you are exactly the trader they want to fund.
🎯 Bottom line: Use this calculator before every challenge attempt. Know your exact daily loss limit in dollars, your required daily profit, and your projected ROI. Trading with clear numbers beats trading with vague hopes.
The Core Formulas
Profit target ($) = Account × Target%. Max drawdown ($) = Account × MaxDD%. Daily drawdown ($) = Account × DailyDD%. Min profit/day = Target($) ÷ Trading days.
Worked example
$100,000 account, 8% target, 10% max drawdown, 5% daily drawdown, 30 trading days: Target = $8,000. Max drawdown = $10,000. Daily drawdown = $5,000. Minimum average profit needed = $8,000 ÷ 30 = $266.67/day. At 1% risk per trade ($1,000), you could absorb 5 losing trades in one day ($5,000 ÷ $1,000) before breaching the daily limit.
Avoid These Mistakes
Not knowing your daily limit in dollars before you trade
"5% daily drawdown" doesn't mean much mid-session — know the exact dollar figure before the market opens, not after a bad morning.
Confusing static and trailing drawdown
A static floor stays fixed no matter how much your account grows; a trailing floor rises with your equity peak. Trading as if you have more room than you actually do is a common, entirely avoidable way to fail.
Sizing risk without checking the daily limit first
Three losing trades at 2% risk each is a 6% daily loss — enough to breach most firms' 5% daily limit in a single bad morning. Size risk against the daily number, not just your gut feel.
Frequently Asked Questions
What is a prop firm challenge?
A prop firm (proprietary trading firm) challenge is an evaluation where traders pay a fee to prove they can trade profitably within set rules. If you pass, the firm funds you with a larger account (up to $200K+) and you keep 70-90% of profits. Major firms include FTMO, MyForexFunds, FundedNext, and The5ers.
What are the typical challenge rules?
Most firms require: Profit target of 8-10%, Maximum drawdown of 8-12% (from initial balance), Daily drawdown of 4-5% (from highest balance that day), Minimum trading days of 4-10, and a time limit of 30-60 days. Rules vary by firm — always check your specific firm's conditions.
How is daily drawdown calculated?
It depends on the firm. This calculator computes daily drawdown as a fixed percentage of your initial balance (static), which matches firms like FTMO's 2-Step and The5%ers. Other firms — including FTMO's 1-Step and TopStep — use a trailing daily drawdown instead, recalculated from the highest equity/balance reached that day (e.g. if your account reaches $105,000 during the day, a 5% trailing floor for that day would be $105,000 × (1-5%) = $99,750). Confirm which model your specific firm and plan use — the two produce different dollar floors as your account grows.
What is a profit split?
After passing the challenge and getting funded, you keep a percentage of profits. Standard splits are 70-90%. FTMO offers up to 90%, FundedNext up to 90%. The firm keeps the remainder as their fee for providing the capital.
References
📄 Your firm's official rules page
Profit targets, drawdown percentages, methodology (static vs. trailing), and time limits are set individually by each firm and change over time — always confirm current rules on the firm's own site before purchasing a challenge.
📊 Your own trading statistics
The daily-loss risk table above is only as useful as your actual average risk per trade — track your real numbers rather than assuming a round figure.