Forex traders can now obtain live trading capital and fully funded trading accounts from third party providers. Thousands of traders are being funded every year from various capital providers. Any forex trader who is competent, skilled and profitable, but lacks the funds to trade live should investigate these funding companies. This article will provide lots of details on what programs are available to get funding. Traders can earn strong commissions, like 80%, to be paid for their trading skills.
Companies That Provide Live Trading Capital
Several companies provide live trading capital for forex traders. Here is a partial list:
Topstepfx, FTMO, the5ers, Blufx, Maverickfx, Fidelcrest, Audacity, Traders4traders, and Enfoid. We also found a handful of forex brokers who have capital referral programs. There are also private entities and individuals on places like Linkedin that advertise funding available for forex traders. Some of these capital providers have been in business over 5 years. You can supplement this list with some Google searches.
How Much Live Trading Capital is Available
Traders who quality are eligible to receive up to $1,000,000 or more USD in buying power, including leverage, from many of the available capital provider programs. Example, a funding company might offer a trader a $5,000 account with 100:1 leverage, which is $500,000 USD in buying power. Some companies will fund traders in Euros rather than US Dollars. Be sure to ask what leverage is being used from the providers. In 2019 over 1700 accounts were funded by just one provider, Topstepfx, per their website.
Fees For Obtaining Live Trading Capital
Capital providers charge one time up front fees or monthly fees. In some cases the fees are refundable out of the trading profits. Monthly fees range from $125 to $275 per month. One time up front fees range from $150-$1200. This is for access of between $200,000 and $1,000,000 USD of buying power. We should point out that some capital providers have fees that are 100% refundable.
We would question each provider if the trading platform they provide has institutional spreads or direct access spreads. Inquire if the brokerage platform they provide is also a profit center for their IB operation. Most funding providers likely also make money off of each trade as an introducing broker. Don’t pay for high spreads on top of the fees they charge.
How Traders Can Quality For Live Trading Capital
Each program has a demonstration or qualification period to obtain the funding. It can be a one or two step process. During the qualification period you must abide by the capital provider’s rules like profit targets, position size, daily and total loss or drawdown limits, maximum number of positions open and position size, etc. These rules and guidelines are in writing, so read them carefully. If you break the rules you might be liable for paying more fees to restart get more funding or restart the process. The demonstration period can very from one month to several months to hit the profit targets. All of the providers we found cover all trading losses up to the specified loss limits. Don’t be intimidated by the funding qualification process, under some programs you can qualify for funding in as little as one day.
How to get even more capital => Some capital providers will increase the amount of capital they make available to a trader for trading profitably. Some capital providers will double the amount of capital you can access for increasing your account balance by only 10%, which is a modest amount of profit. For example if you get a $5,000 trading account and you increase the account to $5,500 with positive trades, you will be able to access $5,000 more trading capital. We view this as generous.
More Criteria For Selecting A Live Trading Capital Provider
Profit splits range from 50/50 to 80/20, with the traders keeping 80%. Topstepfx allows traders to keep the first 100% of $5,000 in profits. 50% seems pretty low for a profit split, in our opinion. Profits can be withdrawn via bank wire and in some cases, Paypal. Transfer fees may apply to small withdrawals. Withdrawals are usually available at the end of the month.
All of the capital providers have drawdown limits. The drawdown is usually measured as the amount of loss of capital from the previous and most recent high balance. Drawdown limits can be weekly or monthly, and range from between 1% and 10% of the high balance, which is a very wide variation. Continue reading this article and we can show you a trading system that can be used that has very little drawdown on each trade entry. This system will minimize drawdown so the tighter drawdown rules can be met.
When selecting a live trading capital provider make sure they show you a list of the available pairs that you can trade with their brokerage platform. We recommend checking their offerings against the 28 most actively traded pairs, which are combinations of the 8 most frequently traded currencies. The USD, CAD, EUR, CHF, GBP, JPY, AUD and NZD are the 8 most frequently traded currencies.
Some capital providers only allow trading on 22 or 24 of these pairs, some providers allow the full 28 pairs. Some providers offer a choice of a lot of pairs to trade, but these pairs are outside the 8 most frequently traded currencies. These spreads on these pairs are very high and should not be traded inside of these programs.
Traders should inquire as to what trading platform is offered by the capital provider that you are evaluating. If all of your trading experience is on Metatrader 4, but the capital provider may not offer that platform. If you are seeking their capital might have to download the platform they offer for executing trades and managing the account, so make sure you ask this important question. Being experienced using a new platform is very important before applying for funding.
Some capital providers offer expensive training programs, costing thousands of dollars up front, before you can qualify for capital. We would avoid these capital providers all together. Forexearlywarning can provide a complete training program, our 35 illustrated forex lessons, to teach you everything you need to know about our complete, profitable trading system.
Most of the capital providers we reviewed were offering 100:1 leverage. If you are used to trading at 50:1 or some other leverage rate, remember to keep this in mind as it will affect your margin balances on each trade.
Some capital providers do not let you hold trades over the weekend, or even overnight. This is not good at all. It makes it impossible to swing trade or do any trend based trading on the higher time frames. Avoid these types of restrictions, if possible.
Some capital providers offer a free trial, which is excellent.
Trader Profile For Live Trading Capital
If you are a forex trader, and would like to have access to live trading capital, here are some characteristics we think you should have:
First of all you should have a rules based trading system, and you are able to consistently make positive pips when you use it, week after week. You must like your trading system and understand it well via demo trading or micro lot trading. You must be skilled at entering trades and managing trades with stops and scaling out lots. We advise using a complete trading system like the Forexearlywarning trading system. We offer thorough market analysis, more exact trade entry points across 28 pairs, and very little drawdown on trade entries. The low drawdown will comply with most capital programs. If you are a rookie trader with little experience, you should avoid all live trading capital programs, you are not ready yet.
Trading System To Use With Your Funded Forex Trading Account
If you are a trader who is seeking capital, and you need a profitable trading system with a low drawdown, check out the Forexearlywarning trading system. You can demo trade our trading system and get consistent trades prior to applying for a funded account..
Forexearlywarning provides daily trading plans for 28 pairs, and we focus on the higher time frames. The higher time frames will get you more pips and profits than scalping the same pairs over and over with indicators. Forexearlywarning also has reliable alert systems and an excellent trade entry management system, The Forex Heatmap®. Do not use any trading system with ambiguous or random trade entries or rules for entry that are unclear.
An example trade signal for the GBP pairs on the heatmap is shown above, consistent, clear signals like this for trading are powerful and traders will have very little drawdown on trade entries, as to fully comply with the drawdown rules from most capital providers.
By offering 28 pairs, the Forexearlywarning trading system matches or exceeds the most and most liquid pairs to trade offered in most capital programs. The heatmap system will provide traders with much lower drawdown on trade entry points so almost any capital program can be used. With the Forexearlywarning trading system, you can easily make 10% on your account balance on one swing trade based on the H4 time frame. This will qualify you for more capital on some of the capital providers programs.
Other advantages of using the Forexearlywarning trading system are that is can be easily demo traded. You must like your trading system and enjoy using it before you apply for any third party funded account.
Conclusions about live trading capital programs: A large amount of capital is available to forex traders to fund their live accounts, and we predict that even more capital will be available going forward. Any program that offers a fully funded forex trading account, that also covers your trading losses sound like a great offer. Traders who have no capital or just a small amount of capital, who are skilled at making positive trades, should evaluate these capital providers. Traders should remember that the trading rules vary between providers, so read each capital providers’ rules carefully, get everything in writing, like the fee structure and ongoing drawdown limits.