# What is Profit split?

> A profit split is the share of a simulated funded account's profit a prop firm pays the trader as a performance reward, with the rest retained by the firm.

- Source: https://pipvalley.com/glossary/profit-split
- Publisher: PipValley - web design studio for prop trading firms
- Updated: 2026-10-03

In a prop firm, the profit split is stated as a percentage, such as 80% to the trader and 20% to the firm. It applies to profit in the simulated funded account above the starting balance, paid at each eligible payout.

Many firms advertise splits of 80% or higher, and some offer up to 90% or 100% through add-ons, scaling plans or after a number of payouts. Any up to figure needs its condition in the same sentence.

Because the funded stage is usually simulated, the split is better described as the basis for a performance reward than as a share of trading profits the firm earned.

## Why it matters

The split is one of the first numbers traders compare, but a higher split is a direct increase in payout liability. Model it with your pass rate and payout ratio before raising it to match a competitor. On your site, state the default split, every condition for a higher one, and when it applies.

## Example

A trader with $4,000 of profit on a simulated funded account at an 80% split requests a $3,200 performance reward. Illustrative only.