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Based in Exeter - working across prop trading firms worldwide

Glossary · Running the business

Prop firm

  • Also called
  • proprietary trading firm
  • retail prop trading
  • funded trader program

What it means

In the retail sense, a prop firm differs from a traditional proprietary trading firm, which trades its own capital with employed traders. A retail prop firm sells evaluations to the public, and most of its revenue comes from fees; its main cost is the performance rewards it pays to traders who pass.

Retail prop firms operate in forex and CFDs, futures, crypto and stocks, each with different platforms, rules and regulatory considerations. Some are backed by brokers, some run on white-label technology, and some build their own stack.

How a retail prop firm is treated by regulators varies by jurisdiction and by how the product is structured, which is why many firms take legal advice on structure, marketing and terms before launch.

Related terms

Read these next.

Evaluations

Evaluation

An evaluation is the paid, rule-bound test a prop firm sells, in which a trader must hit a profit target in a simulated account without breaking any risk rule.
Evaluations

Simulated funded account

A simulated funded account is the post-evaluation account a prop firm gives a trader: trades run in a simulated environment and the firm pays performance rewards on results.
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.
Payouts

Payout ratio

Payout ratio is the share of a prop firm's revenue paid out to traders as performance rewards over a period, the key measure of whether the model is sustainable.
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

Trust center

One place for the facts a cautious trader checks: the legal entity, address, people, policies, restricted countries and how payouts work.
Tool

Prop Firm Launch Cost Calculator

Estimate what it costs to launch a prop firm: platform, CRM, KYC, payments, legal, website and marketing.
Guide

Prop Firm CRM: Features, Options and What to Ask (2026)

What a prop firm CRM must do in 2026: the trader lifecycle from order to payout, KYC, support, affiliates and audit logs, plus bundled versus standalone options and 20 questions to ask.
Guide

Prop Firm Website Checklist: Every Page and Section (2026)

What a prop firm website needs in 2026: the dozen core pages, what goes above the fold, how the pricing table and rules should work, the proof traders trust and the disclosures every page needs.

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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