Forex Academy · Follow
7 min read · Jul 14, 2022
If you’re not already familiar with FTMO, it’s one of a handful of professional prop trading firms available, which provide six-figure funding to traders who exhibit discipline and use profitable strategies and strategic trading skills.
As with other prop trading firms, FTMO requires participants to first pass a trading challenge that has strict rules for a target profit you need to meet, how many days you can trade, how much you can lose on any day, and how much you can lose at any point during the overall challenge.
There is a fee to participate in the challenge, depending on how large of an account you’d like to manage, as well as the exchange rate between your currency and the Euro*.
Once you pass the challenge, you trade with FTMO provided funds, and every month you split your profit with the company. This works by sending FTMO an invoice in the amount you’d like to withdraw from your account. You get to walk away with 70% of the profit and FTMO takes 30%.
If you’re able to make 10% on a $200,000, you can end up with $14,000 paid out to you.
Checkout Our Official Website
Checkout Our Results And Testimonials
There are restrictions, of course, for how much you can lose on the account, and if you’re not responsible with your trading, you can lose your status as a funded trader.
While there’s quite a bit of healthy and reasonable skepticism about the reliability and trustworthiness of prop trading firms, I really do believe FTMO is one of the most well-documented firms to provide an honest and fair prop trading experience.
Before I decided to go for a prop trading challenge, I did quite a bit of research to determine which firm I’d like to trade with, and I felt FTMO was the best fit.
I will share what has worked for me and leave it to you, dear viewer, to come to your own conclusions as to whether you’d like to take a FTMO challenge or not.
So Before I dive into what my FTMO challenge was like, I want to give you a little context regarding my trading style.
Here are three important aspects about the way I trade:
That means I keep very clear-cut rules for each step of the trade: the signal, the entry, the stop loss, and the take profit target.
My trading rules can be written down as a checklist which I can cross off one by one for every trade I take.
The only bit of discretionary decision-making I allow is for visually determining the direction that price is moving towards.
Otherwise, every other element has set rules.
Theoretically, I can put my strategy down on paper as one of those Yes or No flow charts if I needed to.
This leaves very little room for my own opinion and I like to keep it that way.
I only take one trade a day tops, and that’s if there’s a proper signal on the chart.
I also only allow an entry between 630am and 930 am PST, to trade during the crossover of the London and New York sessions.
Lastly, I only trade the EUR/USD.
So to summarize, that’s one trade, at one time of the day, with one currency pair.
I don’t currently use complicated exit strategies, although I’ve found trailing stops to be helpful in the past.
I try to keep my time watching the charts to an absolute minimum.
By turning the screen off, I don’t tempt my creative brain to make spur-of-the-moment trading decisions.
However, doing a lot of backtesting on my strategy gives me more than enough confidence so that I can now watch my trade if I want to, without having any hard feelings if it goes sour.
Okay, so this $200k account is actually my third attempt at getting funded after starting my first challenge about two months ago.
My first attempt was for a $100k account and while my demo account was in profit, I lost 5.5% on a given day due to some position sizing mismanagement.
Feeling like I still had the potential to hit the target with my strategy, I ended up jumping back into another attempt two days after losing my first one.
Unfortunately, I found out too late that the tempo of my strategy depended on early wins from the beginning of the month that I had lost with the last attempt.
So I realized that while my strategy worked well for me when I was casually trading with my own small account without any profit targets, I needed something far more durable for a trading challenge that involves stopping and starting with different times in the economic calendar, and requires a larger profit target than the 4–8% per month that I was used to.
And perhaps that’s one of the important things to realize before jumping into the FTMO challenge.
While you’ll want to carry over your trading skills around risk management and discipline, even a profitable, homespun strategy may need some tweaking to meet the time-bound requirements of the challenge, as well as the profit targets.
My second challenge failed.
So before starting this third challenge, I got down to work and had a few ten hour days of focusing solely on crafting and backtesting a strategy that would both hit the profit target and stay profitable at any time of the month, not to mention, in any kind of market environment as well.
If I want to stay optimistic and focus on the benefits that come from frustrating experiences, I could say that the fees I spent on the first two FTMO challenges were the price of admission I needed to pay to get so worked up and determined to craft a far more profitable strategy than anything I’ve ever traded before, which I probably wouldn’t have bothered doing if I hadn’t made an attempt at prop trading.
I’m sure some of you reading this who have done this challenge, too, may also feel like doing a funded account challenge forced you to become a better trader than you were before.
I know for myself that I often have to put skin in the game to really learn from an experience, which is sometimes a very costly way to live my life, but I also implant lessons in my memory much better when emotion is involved.
Actually, I think this is true for most learners, as well.
So by actually paying for a challenge, I was more willing to find a solution than, say, give up, which is more of a reasonable choice when trading a free demo challenge.
I decided to go for a $200k account instead of a $100k account on my third challenge because after doing copious sessions of backtesting, I determined that trading a $200k account on my worst trading month would still result in enough profit to cover my monthly budget.
Third times the charm, right?
As you can see here on my equity chart, I started off with a number of successful trades and I think that having early wins really helped me carry into a string of losses with far more comfort and confidence than if I had started with only those losses.
With this challenge, because I traded only once a day, I allowed myself a slightly larger risk amount at 3% of my account .
I didn’t feel like trading a 200k account was any different from a 100k account or a $5k account which is what I was coming from.
I’ve trained myself to think in terms of Risk points or percentage points, so the account dollar amounts don’t mean anything to me.
If you haven’t already, I recommend conditioning yourself to think in terms of percentages. It can help take a lot of the emotion out of watching dollar amounts going up and down when you trade.
Checkout Our Official Website
Checkout Our Results And Testimonials
Tags:
Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge, Pass FTMO Challenge
