per FTMO the violation is hard stop on the account.
does not matter how much it has in it, once violated the rules, the account has gone.
the rule is, one trader (or trading strategy) can have a maximum capital allocation of $300K prior to scaling up of the account.
I opted to have one 200k and one 100k with a backup 100k.
I view a single master account as simpler to manage.
Although if you lose the master account it's gone in one swift move whereas if you kept the 100k accounts separate and traded at least 2 different strategies across the 3 accounts you might lose control of 1 but still have 2 active.
What I like though is the fact that I have 5% of 300k to play with on a daily basis and Max Loss of 10% of 300k.
15000 Max Daily Loss as opposed to just 5k.
30000 Max Loss as opposed to just 10k.
So one has much larger risk range in $ terms to play within.
Not a bad idea to throw in a few more backup challenges either earlier on or after first successful profit share.
In fact my approach might be to do an additional 3 by 100k challenges and if successful keep them as part of a Plan B just in case the 300k account was to meet with grief I can almost immediately start another 300k master account and continue where I left off.
Smart move would be to do the additional challenges with gained trading profits assuming that a 300k funded account is already active!
I think if one of the 3 fail then that account is dead after any profit sharing is completed.
The other 2 by 100k accounts would continue to scale independently growing at 25% every 4 months once trading objectives are met including profit target of at least 10% is met over the valid 4 month period.
A 100k account would scale to 300k in about 2 years 8 months.
A 300k account would scale to 1050000 in about 3 years 4 months.
Ofcourse, actual account equity could be much higher depending on profit share withdrawals and generated profit.
ps. I notice that another firm FC is showing a one time verification for 400k ($1399) however, trading objectives appear to be much more restrictive.
If one's monthly income could be considered as very comfortable at 10% gain per month on a 100k account then on a 300k account one might shoot for half the monthly gain of 5% and still generate 50% more income per month.
Only difference is capital and lot sizing over same trade count.
Identical strategy can be used.
I'm actually wondering if the FTMO funded account is truly a live funded account? In other words one is given $300k to trade of real money?? I do find it a amazing that any person or company is going to risk $300000 in the hands of a small RT in a market where sudden spikes do occur. Remember the CHF spike of a few years ago and the JPY spike last year. Also FTMO does not stipulate the placing of stop loss on every trade.
Are we sure the the "live" account is not still the demo - in which case the only risk to FTMO is only ever going to be your daily loss limit?
I can diversify risk myself by being able to trade several different strategies however, I would only be able to trade the one 300k account.
If I have the 3 extra verifications completed then I would simply trade them myself.
In any case I am yet to even start a challenge so I have my work cut out for me
If you have a friend who you think is equally a good trader, then you can pay for them to take the challenge with the promise of shared reward, even better if their trading style is different from yours. That would be a good hedge.
WHERE DOES THE CAPITAL COME FROM FOR THE FUNDED ACCOUNTS?
Answer: The adequate reserve of capital for Professional accounts come from Challenge fees and from private investors looking for signals
I'm sure the business model is basically the same with all of these Prop companies? (by the way, I doubt if they get much money from "private investors looking for signals"!)
it has been discussed.
it takes less than 2 min to find.
why the guesswork?
Special account (“ FTMO Funded Account”)
Ha ha - very clear mate - as clear as mud! But yes indeed one is still trading a demo - of course no one is going to take that sort of risk with real money
But we were actually discussed the source of the money (70/30 profit split) which is split between FTMO and the trader. Your quote does not answer that question but the money paid to the trader (if he/she evenyually shows a profit) obviously comes from challenge fees.
And sorry, your maximum daily loss is not their loss of course! If one exceeds it one is out of the game but of course they have lost nothing because you're trading a demo account. Ding dong, I only just thought of that
you are conflating issues. They will let traders manage a demo account but that should be mirroring on some real account with some funds of some sort. The reason for the demo account is because of regulation. They are not brokers and don't have the license for that and i believe assigning demo account to traders who pass the challenge is a way to stay within their regulatory limits.
But surely, those trades are mirrored in some real accounts with some funds to cover the cost of paying profits, I believe.
Unless of course you mean there's enough people signing up for the challenge that, fees from failed participants is enough to pay the running expense of FTMO and the profits from real accounts. It could be that as I don't know the internal workings of FTMO, but I highly doubt that's the sole source of their income.
the max one can lose is 600 some dollars if failed.
the same will be refunded with the first month profit; any money made on top of that is profit.
it is way better than funding an offshore broker 600usd with 1:1000 leverage. Hello?
again, if one believes they are not legit, yep.. has the right to believe so.
personally, I believe there are aliens living in this world.
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