Prop trading firms continue to pop up, promising skilled retail traders the ability to boost their trading income.
Copy trading has been one of the fastest-growing sub-categories of trading, Understanding how copy trading works in prop trading can help prop traders magnify their income sources. Read on to find out how you can leverage copy trading at prop firms.
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- PipFarm, .
- FTMO, The best prop trading firm with a genuine path for salaried prop traders.
- Fidelcrest, The highest maximum drawdown among retail prop firms of up to 20%.
- E8 Funding, The retail prop firm with the most customization options for funded accounts.
PipFarm
In SummaryI rank PipFarm among the best copy trading prop firms due to a generous trailing maximum drawdown of 12%. PipFarm does not upsell upgrades and offers everyone identical trading conditions. It also rewards consistent performance with improved trading conditions and free challenges to increase assets under management and 50% trading commission reductions.
PipFarm requires traders to trade for at least three days, and the profit target is 12% with a maximum daily drawdown of 3%. Prop traders can choose between seven funded account options and use copy trading from one of their accounts but not from other PipFarm traders.
Pros & Cons
- Maximum funded accounts of up to $1.5 million
- Challenges provided on the popular cTrader platform.
- Low minimum evaluation fee starting from $50
- Profit share of up to 95%
- Does not offer stock trading
FTMO
In Summary The best prop trading firm with a genuine path for salaried prop tradersFTMO is a prop firm headquartered in the Czech Republic with a two-step verification process, and traders can use MT4, MT5, and cTrader without strategy restrictions. Unlike most prop firms, FTMO added a feature allowing qualifying traders to become professional traders with a fixed salary via Quantlane, making FTMO one of the best prop firms allowing copy trading.
Traders get a maximum Forex leverage of 1:100, a daily loss limit of 5%, and a maximum drawdown limit of 10%. The profit target is 10% and 5% during the two-step verification process, with a minimum of four trading days.
Pros & Cons
- Reasonable profit targets and generous maximum loss levels
- 80% to 90% profit share with a fast withdrawal process
- Customizable two-step evaluation period with free retrials where applicable
- MT4, MT5, and cTrader accounts with generous leverage
- No information about which broker or brokers FTMO uses
Fidelcrest
In Summary The highest maximum drawdown among retail prop firms of up to 20%Traders at TopTier Trader can manage portfolios with a maximum leverage of 1:100, a daily loss limit of 5%, and a maximum drawdown limit of 10%. It makes TopTier Trader one of the best prop firms allowing copy trading. During the two-step evaluation process, traders must trade for at least four days. The profit target is 10% during the first step and 5% during the second step.
Traders can choose from seven accounts that can scale to $2,000,000. TopTier Trader offers unlimited retrials if traders fail to reach the profit target and have not violated the trading rules.
Pros & Cons
- Generous maximum loss levels of up to 20%
- Competitive leverage and 175+ assets covering five sectors
- Up to 90% profit share and up to $2,000,000 in funded accounts per trader
- MT4 and MT5 trading accounts with algorithmic trading permitted
- No information about the management team
E8 Funding
In Summary The retail prop firm with the most customization options for funded accountsI rank E8 among the best prop firms allowing copy trading in MT5, as it lets prop traders customize their trading conditions. Besides six funded account options, traders can choose their maximum drawdown between 6% and 14% in 1% increments, making the challenge more expensive the higher the maximum drawdown. E8 also allows traders to set their desired profit split between 40% and an unprecedented 100%, in 10% increments, making the challenge more expensive the higher the profit split.
The profit target is 10% for the one-step challenge, 10%-5% for the two-step challenge, and 8%-4%-4% for the three-step alternative.
Pros & Cons
- Competitive leverage and commission-based spreads from 0.3 pips
- Four funded accounts in three base currencies
- 80% profit share payable after eight days, followed by bi-weekly payouts
- No details about the management team
- No information about which broker or brokers E8 Funding uses
Prop Firms that Allow Copy Trading
Trading with prop firms that allow copy trading allows prop traders to use their strategy across different prop trading firms to boost their assets under management and, therefore, their revenue streams. It also allows traders to diversify across prop firms.
For example, if a prop firm offers $200,000 in maximum funds per trader, prop traders can use copy trading software to apply at five prop firms to have their strategy manage $1,000,000.
What Can You Trade with Copy Trading Prop Firms?
Prop firms that allow copy trading always partner with brokerages, and the asset selection depends on the partner broker and any restrictions the prop firm may implement. The best prop firms allow trading across all major markets including Forex, commodities, equities, indices, and cryptocurrencies.
Are Copy Trading Prop Firms Legit?
Retail prop trading is an unregulated business, but prop firms that allow copy trading are duly registered as a business in the country where they have their registered address. Therefore, traders must always proceed cautiously.Here is how prop firms that allow copy trading differ from the top copy trading platforms:
Bottom Line
Many prop firms that allow copy trading limit it to traders copying their strategy across portfolios. Trading with prop firms that enable copy trading from external signal providers raises a red flag that the firm relies on fee-based challenge fees rather than profitable trading. A prop firm could directly copy trades from signal providers, but it would eliminate opportunities for charging traders one-off challenge fees.
