What is a Prop Firm?

We all know how difficult forex and other financial markets are.

What is the Funding System in Prop Companies?

In these markets, both risk management and capital management require serious discipline. Even if we can provide this discipline, if we do not have a certain amount of capital, it is almost impossible to make a living by doing this job.

Prop Firm and Lack of Capital in Financial Markets

So what should we do if we want to trade in financial markets such as forex and crypto and do not have enough capital?

We will be looking for an answer to this question in this article.

What is a Prop Company?

First of all, we will start with the question of what is a prop company and why should we learn it. Prop companies are generally companies that enable investors to grow their capital faster. The main purpose of these companies is to offer investors certain account types under the name of “challenge” and to make a profit from these purchased accounts.

So why do investors buy these accounts? The answer is simple, to grow their capital faster.

LionFunded Capital Growth A Realistic Calculation

Let’s do a calculation with you: You have a balance of $ 1000 and your goal is to make this balance $ 10,000 by the end of the year. It may seem easy at first, after all, you have 12 months to achieve this goal. But it’s not that easy. Even if you manage to grow your $1000 balance by 10% every month (and if you can do that, you’re considered more successful than 99% of traders), you’ll have around $3478 at the end of the 12th month.

The Challenge of Growing Your Capital

Unless you’ve found a top-secret formula, it’s not really possible to make $9000 in profit in 12 months. But don’t be discouraged, there’s a solution that will help you reach this goal in less than 12 months. Prop companies like Lionfunded offers you account options from $5,000 to $100,000. In order to reach this capital, you first need to be able to grow your 2-phase or 3-phase account types based on profit. If you can grow it, that’s when the magic begins. If you can complete the phases of a $100,000 account, you can trade as if your capital was $100,000.

This is also true for other account types.

Lionfunded Account Options and Challenges

Let’s continue with our calculations.

You still have a balance of $1000 and you want to increase this balance to $10,000 by the end of the year. This time, instead of trading with $1000, you prefer to buy an account from Lionfunded. Right now, you can buy almost 2 $100,000 balance challenges for a $1000 budget. You have purchased your account and successfully completed all phases. In the next process (funded phase), you are now ready to make a profit from this account.

For your $10,000 target, you need to grow this account by approximately 13% (The company receives 20% profit share from each of your profits, so we calculate it as 13% instead of 10%).

Reaching Your Target with Prop Companies

It was quite difficult to reach our target in our calculation above, but thanks to best prop firm companies, it is quite doable to achieve an annual growth of 13% and reach our target. You can even reach this target in less than 1 year! So, what rules should we pay attention to when going through the phases we mentioned earlier and getting funded? At Lionfunded, we have set certain rules in order to both develop a sustainable business model and protect investors.

Lionfunded Rules Profit Targets and Phases

Let’s examine these rules and some of the opportunities we offer:
Profit targets of the phases: In order to become funded, you are first asked to complete the phases. These phases vary depending on the account type. Some account types have 2 phases, while others have 3 phases. You should decide which account type to get. Let’s continue our example with the 2-phase account type. If you buy an account, you will be eligible to become funded when you achieve 8% growth in the first phase and 4% in the second phase.

Daily loss limit/Total loss limit: These rules are in place to protect both the company and the investor. Your daily total loss limit is 5% and your total loss limit is 10%. If you exceed these loss limits, you will lose the ‘challenge’ account.

Profit Sharing in Funded Accounts (Profit Sharing): When you complete the phases and become funded, you will be ready to withdraw profit. 80% of the balance you grow in funded accounts is completely yours. 20% remains with the company.

Phase transition period: We have good news for you. You have unlimited time to pass the phase stages! You can easily implement your strategy and complete your phases without any time limit.

The Benefit of Prop Companies

You can access more detailed information about Lionfunded rules. As a result, prop companies provide investors with an opportunity to grow their capital faster. The funding system offered by these companies provides investors with the necessary capital, while also including important elements such as risk management, training and performance evaluation.

This system supports the investor to be successful in the financial markets and enables companies to make profits. The funding system not only meets the investor’s capital needs, but also allows them to trade more effectively in the professional market.
Lionfunded is and will be here to support the investor’s capital growth adventure.