Payout Terms

Profit Split

The percentage of trading profits that the trader keeps versus what the prop firm retains.

The profit split determines how profits are divided between you (the trader) and the prop firm. It's one of the most important factors when choosing a firm.

Common Splits

80/20: You keep 80%, firm keeps 20% (most common starting split)
90/10: Available at some firms or after scaling
100/0: Some firms offer 100% on the first payout or up to a certain amount

Scaling Profit Splits

Many firms increase your profit split as you demonstrate consistency:

First $10K in payouts: 80/20
After $10K: 85/15
After $25K: 90/10

Calculating Your Actual Take-Home

Remember to factor in challenge fees when calculating actual ROI. If you paid $200 for a challenge and your first payout is $1,000 at an 80% split, your net profit is ($1,000 × 0.80) - $200 = $600.

Related Terms

Funded Account

A simulated trading account provided by a prop firm after passing their evaluation, where you trade with the firm's capital.

Payout Frequency

How often a prop firm processes profit withdrawals for funded traders.

Scaling Plan

A program that allows successful funded traders to increase their account size and improve their profit split over time.

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