Summary:

Some prop trading firms are legit, but not all are. Signs of a reputable firm include clear terms, transparency, and a strong online presence.

Key Points:

• Legit prop firms have professional websites, clear evaluation processes, and reliable customer support.
• Check reviews and online presence to find reliable prop firms.
• Avoid firms with no customer support and guaranteed profit.

As a trader, it’s crucial that you partner with a reputable and reliable firm to increase your chances of success. One option for trading that’s grown in popularity lately is a prop firm These firms offer simulated accounts and real profit splits for successful traders.

Of course, there’s no such thing as guaranteed success in trading. But, prop firms help traders just like you limit risk by using an upfront payment model and, sometimes, optional add-ons. Instead of risking your own money for each and every trade, you only pay a clear and fixed cost.

Sounds pretty good, right? The prop trading model is exciting and can be a great way to limit risk. But it also leads savvy traders to a very important question.

Are prop trading firms legit, and how can you find the right firm to partner with? We answer these questions and more below.

What Is a Prop Firm?

A proprietary trading firm (prop firm) is a type of financial institution. The firm uses its own capital to fund experienced traders who do not have access to substantial funds on their own.

How Do Prop Firms Work?

It’s a simple setup. Eligible traders sign up for an account, which gives them access to the firm’s funds, trading tools, and support.

In exchange for this access, the trader gives the prop firm a portion of their profit share. The prop firm covers any resulting losses. This is why such firms aim to work with experienced traders to improve their prospects of success, and why traders have to pass a challenge before they start trading with a simulated funded account.

Prop firms enable traders to work across various asset classes. For example, you might trade in the equities market. Or, you could trade other assets, such as Forex.

Is a Prop Firm Legit?

Is prop trading legit? Yes, the basic idea of prop trading is totally legit, and some prop firms are entirely legit, too!

However, not all prop firms are legit – you can’t just pick any prop firm and have a guarantee that they’re for real. So, what can you do to find a prop firm you can count on?

How to Find Legit Prop Trading Firms

Now that we know that some prop firms and Forex prop firms are legit, here’s how to find those legitimate platforms.

Professional Online Presence

A web presence matters. Sure, there’s no need for the firm to feature on every social media platform. They should at least have a professional website, though. it should be engaging, sleek, and fully functional.

A prop firm’s site should also offer the info you need to make an informed decision about taking one of their challenges. Costs, basic rules, and how to earn a simulated funded account should all be clear.

It’s also a good sign if the firm has an active online community on platforms like Discord, where you can meet other traders and talk to them about their experiences.

Reliable Customer Support

Prop traders work hard every day to make profits. Hours, minutes, and seconds count. Legit prop firms should be easy to contact whenever you need help. And you should be confident that you can ask questions when you need extra support.

This is one of the best ways to tell if a prop trading firm is trustworthy. Do they make their approach to customer support clear? That’s a great sign. If there’s no info about customer support, it’s likely a major red flag.

Transparent About Evaluation Process

Trading isn’t easy. Legit prop firms want to work with talented traders to improve their chances of success. So, while it shouldn’t be incredibly difficult to qualify for a funded account, it shouldn’t be super easy, either.

Here’s what to look for as you learn about the evaluation process:

• The sign-up process should be simple to understand.
• The terms and conditions should be easy to read.
• There should be some acknowledgment of the risks involved in trading.
• You should be in no doubt as to what happens at each stage of the process.

Promising Reviews Online

Your prop firm of choice should have at least some online reviews on authoritative websites like Trustpilot. They don’t all need to be five-star reviews, but they should be positive overall.

If it’s a newer prop firm, it’s okay if they don’t have many reviews. But what you don’t want to see is all negative reviews!

Signs You Should Pick Another Prop Firm

We’ve explained how you can spot legit firms to partner with. But what are some signs of prop firms you probably don’t want to partner with? Here are some red flags you should know about.

Lack of Online Presence

Legit prop trading firms want to be found. They want to attract the best trading talent and grow their platform. What’s the best way to do this? Having a professional online presence.

• If the trading firm doesn’t have a website, steer clear.
• Use caution if the content is littered with a lack of information, spelling errors, and grammatical mistakes. A few typos across an entire website aren’t a big deal, but constant typos, lots of hard-to-understand sentences, and a general lack of info are.
• If there are absolutely no online discussions around the firm, this is another bad sign.

Put simply, if a prop firm’s web presence raises eyebrows, it’s best to find one that matches the signs of a legit firm listed in the previous section.

No Customer Support

Legit prop firms want to help you be successful. They want to support you along your trading journey.

After all, you’re a team together.

So, it should raise alarm bells if there’s no “contact us” option. And if customer service numbers don’t work, or no one gets back to you, these are also bad signs.

Promises and Guarantees

Unfortunately, trading has no guarantees. There’s always some degree of risk involved – you could lose your investment. Legit prop firms won’t shy away from this fact. So, be wary of any prop firm that says otherwise or doesn’t mention risk at all!

Although there are steps you might take to improve your chances of success, you can’t remove all risk. Guarantees and promises are major red flags.

Problematic Online Reviews

It’s concerning if there are more one-star reviews than positive reviews, or if reviews have lots of complaints about the firm, Although it’s hard to say if reviews are legitimate, a pattern of poor reviews is a bad sign.

On the flipside, be wary if there’s nothing but glowing reviews. The comments could be very similar, using the same types of words and phrases. The reviews might be posted within a few hours or days of each other. These signs could indicate that the reviews might be fake, so proceed with caution.

A Simple Checklist for Finding a Prop Firm You Can Count On

To stay safe when choosing a trading platform, you should:

• Read the firm’s terms and conditions and make sure you understand them.
• Ask as many questions as you need to ask before you commit, and expect reasonable, understandable answers.
• Research prop firms before you start trading so you can pick a legit firm.

Put simply, if you’re in doubt about a prop firm, don’t use it. If it seems too good to be true, there’s a good chance that it is.

Get Funded with Maven Trading

Are you ready to trade with a prop firm you can rely on? Maven Trading wants to work with you! We’re looking for ambitious, professional traders who want to take their investing skills to the next level.

We keep our evaluation process as simple as possible to help you get up and running quickly. And if you need help with your trading strategy, don’t worry – we’re here to answer your questions.

Join the action and get funded today!