How to choose a reliable trading partner

In recent years, the number of private individuals wishing to trade in financial markets has increased again. People rushed into this niche because trading on the stock exchange in all its forms is popularized. Advertising can even be found in children’s games on smartphones. 

But trading requires capital, which not everyone has. What to do in this case? Try trading in a prop-trading company. After all, few people know that prop companies offer many opportunities to anyone who wants to become a trader without investing personal money.

What is a prop firm?

A prop firm is a complex mechanism. As in any complex business, various specialists, marketers, lawyers, programmers, risk managers, and others work here. However, the main thing that drives business is Traders.

Traders manage the capital of the company, earning significantly more than they could earn on their own. The company receives the main profit in the form of a percentage of the total earnings of traders. The proportions in which the profit is shared between the trader and the company can vary greatly and depend on the following factors:

• the amount of trading capital and commissions that the firm provides to the trader;
• trading platforms;
• servers;
• data flows;
• historical data;
• and, of course, the education that the firm provides to the trader.

As a rule, in large companies like FX2 Funding, traders are divided into groups. This is done for the convenience of risk control. Therefore, each group must be headed by a risk manager who is responsible for the group’s losses before the company’s chief risk manager.

Features of trading firms

Firms that trade in financial instruments use their capital to make a profit. Often considered the best trading firms, these firms employ skilled traders who use a variety of strategies and tools, such as arbitrage and technical analysis, to identify profitable trades. They are primarily focused on capitalizing on market inefficiencies and price inconsistencies to maximize profits.

In addition, trading firms may participate in index fund financing, where they allocate capital to specific investment strategies based on the performance of the index funds. This approach allows them to diversify their investments and potentially increase profitability.

Benefits for financial organizations:

• Big profit with limited risk and investments.
• Stocks of securities on accounts during stock market trading.
• Ability to become a market maker in certain securities and create liquidity.

Pros for traders:

• Increased leverage.
• Training of successful traders.
• Work in a team of like-minded people.
• A quick dive and experience.
• Unlimited earnings.
• Ability to apply learning experience in other areas and become more successful.

Prop-trading has one important advantage—the opportunity to earn on the market without risking your funds. This opportunity is unattainable for ordinary traders who trade through a broker and always take a risk.

Choose a reliable prop trading company

Reputation is the most crucial factor when choosing a prop trading company. The positive attitude of the community indicates at least the absence of facts of user deception and in the best case — and the stability of the prop.

The following is important for reputation assessment:

1. Reviews: you can fake reviews on the company’s website, and buy them on specialized resources. Therefore, instead of searching for reviews on Google, ask questions about the company in the trading community chat;
2. Date of creation of the project: the longer a prop company exists, the more reliable it is. In the community, it is customary to be cautious about young props created in 2023-2024;
3. The reputation of the broker: most prop companies publish information about working with one or another broker. Pay attention to the broker’s reputation and attitude toward regulators and customers. In addition, prop companies can open their own “one-day broker.”

The opinion of others does not guarantee 100% reliability of the prop company. However, between props with clearly bad and good reputations, choosing the second one will increase the probability that everything will be fine. One of the most honest companies is FX2 Funding.

Pros of cooperating with a reliable trading firm

FX2 Funding offers the following benefits for your cooperation:

• Start trading and earn profits using your preferred trading method.
• Collect up to 85% profit and receive it immediately.
• Trade at your own pace. Receive funds to your account within one day, one month or one year. Choose what is more convenient for you.
• Take advantage of the one-stage evaluation. This system is fair and straightforward, so everything will work out for you.
• FX2 Funding will refund you the entire valuation fee once you receive your top-up account and request your first payout.
• Request the first payout in 7 days, then every 14 days.

Such prop companies are a profitable tool for trading and creating equity.

Approximate structure of prop firms

All prop-trading companies are different. We provide an average structure.

• Managers are a few people who make decisions. These are practicing traders who organized this firm.
• Senior traders are human resources that generate income.
• Risk managers are several people who develop risk management rules and monitor their implementation
• Novice traders learn from senior traders. First, they trade on the simulator, then work with limited volumes. There is a lot of staff turnover here, and many enthusiasts want to get here.

In conclusion, we can say that the prop trading format is good because it allows wavering in the profession of real trade for a comparison card. For beginners, this is just the perfect solution. For experienced market participants, the option is not the most interesting, but it would be wrong to collect it from accounts. Both the trader and the company are equally interested in receiving arrivals, so there is no conflict of interest.

Choosing a prop company is an individual process. Therefore, before starting the search for a suitable option, determine your own goal: the size of the account, the complexity and cost of passing the test, the time perspective, etc.

26/03/2024