Based upon your experience, what are the common reasons that prop firms give you when they refuse to pay out your profits?
Personally, I received a justification for my account closure, claiming that I was allegedly engaging in reverse trading against another prop firm, even though that wasn't true at all. As I only trade Bitcoin, and my view on it is very bullish, this was not the case. However, other traders were given different reasons. One of my friends was denied a payout on the grounds that he supposedly copied another trader by longing Bitcoin, which, in my opinion, is a very weak reason, since by that logic, anyone can be linked to anyone else. If you read the contract carefully — the one you have to sign when the company grants you a funded account — you’ll notice that the firm has no actual obligations or guarantees toward the trader. They might pay out, or they might not — it all comes down to their internal decision, essentially. All of this reminds me of the early days when I first got into online poker (I played cards professionally for 15 years, and now I’ve transitioned into options trading). Back then, the online poker world was completely unregulated — it was like the Wild West. But eventually, regulation came in and brought order. Perhaps prop trading is still in its infancy as an industry, and I hope things will change over time. In itself, this mix of poker and trading is, in my opinion, a great concept.
No, you're in the death-rattle of prop trading. This is the end game after "pay to play" prop was banned. Legit prop: FNYS and (formerly) Quad. Bright Trading (when you made a partnership contribution). K-1. Required the license. Descending in scamminess... "Deposit" prop: gone (don't have names for you). "Challenge" prop: All those that you named. It's the natural progression once all semi-legitimate options are gone. It's essentially a fixed online casino (no RNG).
So even if we look at all of this from the perspective of an online casino, I could still agree that it's unwinnable — if options didn’t exist. The thing is, when we trade options using a delta-neutral strategy, we suddenly become the house, not just a participant. If the trader can manage delta effectively, what remains is pure profit from theta decay. That’s exactly why I currently use prop firms — instead of opening a futures position to hedge my options exposure on my own account, I do it through prop firm accounts. Yes, there’s an added variable — I might not get paid. But not all firms fail to pay. Some do pay out reliably (FTMO, FTM, FP). If the trader controls risk individually with each firm, my experience shows that the profits more than outweigh the risks. That’s because options APR can reach up to 450% annually, and every time a position stays flat for just one week, the theta profits can be massive.
If you are making that allegedly 40%, why don't you just trade futures? There are micros that could match your sizes with a prop firm. Why would you stick with scammers if you are generating a steady income?
Obviously, I will stop working with any company that fails to pay out profits even once. The reason I continue trading is because there's a huge difference between the swaps and holding fees charged by prop firms and the premium paid by the options market. And as I mentioned earlier, even with occasional non-payments, my overall profitability remains high. Also, I never said that I trade exclusively against prop firms I also hold delta-neutral positions by selling put spreads (which gives us positive delta) and selling naked calls (which reduces it). This results in a delta-neutral setup with strong daily theta accumulation.
That's scary. I would never get into a business relationship where the counterparty doesn't have to live up to their end of the bargain by using whatever reason they decide to come up with.
That's the nature of the game But you can adapt to it. Small payouts from each company, low risk with each one individually. It can be a bit tiring to manage a large number of different accounts, but overall, it's still very profitable.