How to Decide Whether or Not Trading a Prop Firm Is Suitable for You

Let’s be real.

You’re tired. You work long hours. You’ve got bills to pay and dreams that feel further away than they should.

Maybe you’ve started looking into Forex trading, and you’ve seen those slick ads promising “instant funding” and “90/10 profit splits” if you trade with a prop firm.

Sounds like an easy way out, right?

But here’s the truth:

Most people fail.

And if you’re not careful, you’ll waste money, time, and hope chasing a dream that was never built for beginners in the first place.

In this article, we’re going to break it down simply. No fluff. No hype. Just facts, figures, and a path forward that makes sense.

What Is a Prop Firm?

A proprietary trading firm (or “prop firm”) gives you access to large amounts of capital to trade.

You don’t risk your own money. Instead, you pass a trading challenge to prove your skill. If you pass, you get to trade their money.

You keep a portion of the profits — usually around 80% to 90%. Sounds good, right?

But there’s a catch.

The Success Rate: Fewer Than 5% Pass

Let’s look at the numbers.

Based on recent figures from major prop firms like FTMO, MyForexFunds (before its shutdown), and The 5%ers:

• Less than 5% of traders pass the initial challenge on their first try.
• Only 1% to 3% of traders hold a funded account for more than 12 months.
• The average lifespan of a funded account? Only between 1 and 3 months.

That’s right — most people either fail the challenge or lose the account soon after getting it.

Why?

Because these firms are not in the business of handing out money.

They’re in the business of selling challenges. And they’re very good at it.

The Real Cost of a Prop Firm Challenge

Here’s what most people don’t realise: the challenge is the product.

You’ll often pay:

• $300–$500 USD for a 10K or 25K challenge
• $800–$1,200 USD for a 100K account
• And some high-tier 200K or 300K challenges cost $2,000+ USD

Now imagine this:
If 1,000 traders pay $500 USD each, that’s $500,000 USD for the firm… whether people pass or not.

These firms can afford to offer “90/10” splits, because they’re making most of their money up front.

The Rules Are Tough — Really Tough

Most prop firms make you:

• Hit a profit target (e.g., 8–10%)
• Stay within a time limit (often 30 days)
• Avoid hitting a drawdown limit (often just 5–10%)
• Stick to strict daily loss limits (sometimes 3–5%)
• Trade within approved hours and risk management rules

And even if you pass, keeping the account is another challenge.

One wrong trade, a news spike, or a stressful day at work where you’re not 100% focused… and your account can be shut down instantly.

That’s not freedom. That’s pressure.

So… Is It Really Worth It?

If you’re an Australian working full-time and trying to break into trading, you’ve got to ask yourself:

Do I have the time, focus, and skill right now to pass a prop firm challenge that fewer than 5% of people succeed at?

Because the truth is — most people don’t.

That doesn’t mean you’re not smart enough. It doesn’t mean you’ll never make it as a trader.

It just means you need a better foundation.

Why So Many People Fail at Prop Firm Accounts

Most people who sign up for prop firm challenges:

• Have no real trading plan
• Trade on emotions or hype
• Follow “gurus” who make money from affiliate links, not trading
• Use over-leveraged systems that fail under real pressure
• Don’t get coaching or feedback — they trade alone

And let’s be honest…

A lot of the big names in the industry don’t want you to succeed — not yet.

They just want you to pay.

The more times you fail and re-apply… the more money they make.

What If You’re in Australia?

If you’re trading from Australia, you’ve got some unique challenges:

• Time Zones: The major forex sessions (London and New York) are late at night or early morning. That’s hard when you’ve got a full-time job and a family.
• Volatility: You’re often trading when markets are quiet, unless you stay up late — which affects your energy, sleep, and judgement.
• Regulations: ASIC regulations limit retail leverage to 30:1, unless you qualify for Pro Trader status (more on this below).

So unless you’ve got a plan, support, and clear structure… you’re trading uphill.

The Smart Way to Build a Trading Income (Without a Prop Firm)

You don’t need a $100K account to be a successful trader.

You don’t need to chase “instant funding.”

You need a foundation.

Here’s how:

1. Start Small — and Stay Consistent

You can start with as little as $500 to $1,000 AUD on a properly regulated broker.

Your goal?
Grow it slowly, safely, and consistently. Even 2% per month is good progress.

And you don’t need a big account to learn good habits.
You need a structured approach, good risk management, and real experience.

2. Use a Demo… the Right Way

Before risking real money — or someone else’s — use a demo account to test your system, mindset, and trading routine.

Don’t just mess around.

Treat it like real money.

Track every trade.

Learn from every mistake.

Build confidence in your Trading Method and your ability to follow it consistently before going live.

3. Get Coaching from Real Trading Coaches

This is a big one.

You wouldn’t try to become a pilot without an experienced successful flight instructor.

Why trade with real money without someone who has actually helped people to do it to show you how?

Look for mentors or coaching programs like LIFT Flex or LIFT Pro, which guide you through building your own profitable system… based on your life, your goals, and your trading style.

4. Qualify for Pro Trader Status (and Unlock Higher Leverage)

Did you know that in Australia, you can qualify for Pro Trader status with some brokers?

This means:

• Higher leverage (100:1 or even more)
• Tighter spreads
• Lower fees
• Access to better tools and analytics

To qualify, you typically need:

• Trading experience
• A financial background or certain income
• To pass a broker’s assessment

This is a real alternative to a prop firm, without the pressure of drawdown rules or profit targets.

The LIFT Programs have all been developed to lead a trader from new to Pro Trader Qualified, by giving you the technical knowledge, the proven results and the Consistency that’s needed to get there.

So… Should You Trade a Prop Firm?

It is completely up to you.

Here’s what we honestly think:

✅ You might be ready if you:

• Already trade profitably on your own money
• Have passed multiple demo challenges
• Have strong emotional discipline
• Know how to stick to a trading plan
• Have been coached, mentored, and tested under pressure

❌ You’re not ready if you:

• Are still learning
• Trade based on gut feeling
• Are hoping this will solve your money problems fast
• Haven’t been profitable over 3–6 months on your own
• Don’t know how to handle risk or losing trades

And there’s no shame in that.

Every great trader started where you are now — overwhelmed, unsure, and looking for a way out.

The smart ones?

They didn’t try to skip steps.

They built from the ground up.

Final Thoughts: Don’t Buy the Dream — Build the Skill

The prop firm industry is built on a powerful dream:

“Use our money, get rich, live free.”

But the reality is far tougher.

Most people lose money on challenges.

Most never hold a funded account for more than a few months.

And many end up disillusioned, broke, and confused about why it didn’t work.

Don’t be one of them.

If you’re serious about trading…

If you’re ready to put in the time, get coached, and follow a proven path…

Then there is a way out.

But it won’t come from buying into a prop firm dream.

It’ll come from building real skill… one trade at a time.

Need help getting started the right way?

At The Trading Coach International, we work with everyday Australians who are tired of the hype and just want a real plan that works.

Whether it’s LIFT Flex, LIFT Pro, or our LIFT Pro Plus Mastery Track, we help you trade smarter, grow safely, and make decisions that actually support your goals.

Ready to take the next step?

Book a Free Strategy Call by clicking on this link and get the tools, coaching, and support you need to stop chasing someone else’s dream… and start building your own.

Disclaimer

Trading forex involves risk and may not be suitable for all investors. Past performance is not indicative of future results. Always conduct your own research before trading.

The information, strategies, techniques and approaches discussed in this article are for general information purposes only.  The Trading Coach International does not necessarily use, promote nor recommend any strategies discussed in this article.  The information in this article may not be suitable for your personal financial circumstances and you should seek independent qualified financial advice before implementing any financial strategy. The Trading Coach International is not a financial advisor and does not have AFS registration.