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Based in Exeter - working across prop trading firms worldwide

Glossary · Risk and drawdown

Liquidity provider

  • Also called
  • LP
  • liquidity bridge
  • prime of prime
  • price feed

What it means

In a prop firm, a liquidity provider matters in two places. First, the price feed for the simulated environment usually comes from an LP or data vendor, so simulated fills are only as realistic as that feed. Second, firms that A-book selected traders send those positions to an LP through a bridge.

Prop firms rarely contract an LP directly at the start. Most get their feed and any live execution through their platform provider, a broker partner or a technology vendor that already holds LP relationships.

LP terms cover spreads, commissions, minimum volumes, margin and collateral, and which counterparties they accept. Some LPs will not work with prop firms or require extra due diligence.

Related terms

Read these next.

Risk and drawdown

A-book

A-book describes trades the firm passes to a real market or liquidity provider; in prop firms, it usually means mirroring selected traders' positions with live capital.
Risk and drawdown

Hybrid model

A hybrid model is a prop firm or broker risk setup that keeps most flow internal (B-book) and routes selected traders or positions to a live market (A-book).
Platforms

Trading platform

A trading platform is the software traders use to place orders and see positions; for a prop firm, it also supplies the account data the risk engine and dashboard rely on.
Platforms

White label

A white label is a technology product another company builds and runs that a prop firm sells under its own brand, such as a platform, challenge engine or a whole firm.
Risk and drawdown

B-book

B-book describes trades the firm does not pass to a market: in prop firms, simulated trades that stay internal, with payouts funded from the firm's own revenue.

On your website

Where this shows up on a prop firm site.

Feature

Rules pages

Rules a trader can read one way: one page per rule, worked examples from your own numbers, and a table of which rules apply to which plan.
Tool

Drawdown Rule Visualiser

See exactly how static, trailing and end-of-day drawdown rules behave on the same equity curve.
Guide

Liquidity Providers for Prop Firms: When You Need One

Do prop firms need a liquidity provider? Price feeds, A-book execution, bridges and broker partners explained, with questions to ask an LP.

Looking for a prop firm to trade with, not a website? Compare firms on PropFirmPal, the comparison site our founder owns.Go to PropFirmPal →

All glossary termsGuides

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