Prop Firm Game / Prop firm glossary

Futures Prop Firm Glossary

Every term you meet when you buy a futures prop firm evaluation, in plain English - and how it works in Prop Firm Game, where you can learn the loop with fake money first.

Rules differ from firm to firm and change over time. Always read a firm's own rules before you buy an evaluation. Nothing here is financial advice.

The basics

Prop firm

A proprietary trading firm. Retail futures prop firms sell evaluations; traders who pass get a funded account and are paid a share of the profits they make on it.In the game: three fictional firms - FOMO Futures, OneMoreTrade and Tilt Prop Firm.

Evaluation (challenge, combine)

The paid test account. Reach the profit target without breaking any rule to qualify for a funded account. Break a rule and the evaluation is over; you buy a new one or pay for a reset.In the game: bought at the Evaluation Office, traded at your apartment desk.

Profit target

The profit an evaluation account must reach to pass, usually a set dollar amount for each account size.In the game: $1,500 on a 25K account, up to $9,000 on 150K.

Funded account

The account a trader gets after passing an evaluation. At most retail futures prop firms it is a simulated account, and the firm pays the trader a share of the profits made on it.In the game: claimed at the Evaluation Office after a pass. It has its own rules: a profit target before each payout and an EOD trailing drawdown.

Payout

A withdrawal of profits from a funded account. Firms set payout rules such as a minimum number of trading days, a safety buffer above the drawdown, caps on the amount and a schedule.In the game: the funded account must first reach its profit target - $450 on a 25K for a $200 payout ($600 on Real prop rules) - then you file a payout request with a form, a review and an approval. Collect twelve to become a Legend.

Profit split

The share of funded-account profits the trader keeps; the firm keeps the rest. It varies by firm and plan.

Activation fee

A one-time fee some firms charge when a passed evaluation becomes a funded account. Not every firm charges one.

Reset

Paying to restart an evaluation from its starting balance, usually for less than a new evaluation. In the game: blow an evaluation and the Evaluation Office resets that account for half price. A funded account has no reset.

Drawdown and loss limits

Max drawdown

The lowest level the account may fall to. Touching it breaches the account, which ends the evaluation or the funded account. Many firms close open positions automatically when it is hit.In the game: the dashed red BREACH line in the trading terminal - $1,500 below the start on a 25K evaluation ($1,000 on Real prop rules). On a funded account it trails at the end of each session (EOD).

Trailing drawdown

A max drawdown level that moves up as the account makes new highs and never moves down. At many firms it stops trailing once it reaches the starting balance or a set level above it.In the game: funded accounts use an end-of-day trailing drawdown - it moves up only at the end of a session, from your closing balance, and stops at the starting balance. Evaluations keep a static line.

Intraday trailing drawdown

A trailing drawdown that follows the highest equity reached during the day, including open profits that were never closed. A winning trade that gives its profit back can still raise the line.

End-of-day drawdown

A trailing drawdown that only moves at the end of each trading day, based on the closing balance, so swings during the day do not raise it.In the game: the funded account's drawdown works this way.

Daily loss limit

The most an account may lose in one trading day. Depending on the firm, hitting it ends trading for the day or fails the account.

Consistency rule

A limit on how much of the total profit may come from a single day, so one lucky day cannot pass an evaluation or unlock a payout on its own.

Minimum trading days

The fewest days a trader must trade before passing an evaluation or requesting a payout.

Scaling plan

A rule that caps how many contracts an account may trade until it has built a profit cushion, then allows more as profits grow.

News rules

Some firms restrict trading around major economic releases such as FOMC rate decisions, CPI or the jobs report, because prices can jump in seconds.

Futures and trading terms

Futures contract

A standardized contract to buy or sell an asset at a set price on a future date. Prop traders usually trade them intraday and close before the session ends.

NQ

The E-mini Nasdaq-100 futures contract. It moves in ticks of 0.25 points, worth $5 each, or $20 per point.In the game: the contract you trade in the terminal.

ES

The E-mini S&P 500 futures contract. It moves in ticks of 0.25 points, worth $12.50 each, or $50 per point.

Micro contracts (MNQ, MES)

One-tenth the size of the E-mini contracts: an MNQ tick is worth $0.50 and an MES tick $1.25. Many traders use them to size down.

Tick and tick value

A tick is the smallest price move a contract can make; the tick value is what that move is worth per contract.

Stop loss

An order that closes a trade at a set price to cap the loss. A stop that gets moved further away is not a stop.

Risk per trade

How much of the account one trade can lose if the stop is hit. Small, fixed risk is what keeps an account away from the drawdown line.

Revenge trading

Trading right after a loss to win it back, usually bigger and faster than planned. The most common way evaluation accounts get blown.In the game: the bar will not serve a Revenge Shot, and there is a Rage Room for the feeling.

Overtrading

Taking too many trades, or trades too large, often out of boredom or fear of missing out (FOMO).