Lately i’ve been doing a lot of thinking on this topic. Especially with a new prop firm popping up almost every few days claiming to be “the best”.
The industry is starting to feel crowded and oversaturated as more people want a piece of the pie that once belonged almost fully to FTMO.
Is this good or bad for us traders?
I have two view points on this and would love to hear your thoughts as well.
Firstly, I believe that with more prop firms comes better trading conditions due to the fact that companies will have to make their offers more attractive to compete against the larger marketplace.
This means normalizing 90%+ payout splits out of the gate, fewer minimum trading days, larger refunds, etc.
This may even force companies to offer even larger challenge accounts reaching closer to the 7 figure mark.
Sounds amazing, right?
But what does this mean for the actual companies?
On the other side of the coin, we have to understand that the prop firm business is no different than a casino.
Casinos understand that a few players will win, even fewer will win BIG, and majority will lose which will pay for the payouts to the winners as well as leave some nice profits for the company to keep.
This is the simple truth that we can not get around.
So, what happens when companies are making their offers so amazing for traders in order to stay competitive that there begins to be a rise in traders successfully passing challenges and receiving payouts?
To keep it short and simple, there will be a fine line between maintaining profitability on the company side and appeasing the traders.
But if that line gets crossed it can be catastrophic on both sides.
Regulations will definitely be coming soon to this industry as there’s more and more firms sprouting up like weeds but how will this affect us?
Unfortunately, im not sure what the future will hold but urgency is always your friend. Regulations could make receiving funding only accessible to a specific group such as accredited investors.
There is a huge wealth transfer going on for traders who were prepared for the opportunities that are currently being presented.
Make sure that you’re putting your all into becoming a consistent trader and surrounding yourself with a team that will only aid you in realizing your goals.
The goal is to seize the opportunity and build up your own personal capital so that there’s no more worry on “will I be able to receive my payout”.
You will be in control of your future.