If you are confused about whether or not you are ready to join a prop firm, then you are here at the right place. We have created a list of essential tell-tale signs that indicate that you are ready to become a funded trader.
You Have Consistent Results
The first sign that you are indeed ready to become a trader and join a prop firm is when you have at least three months’ worth of consistent results with passing a prop firm challenge on a live account. It is important to mention here that consistent trading doesn’t mean that you should be earning ten percent a month or that you are a profitable trader. It only means that you have been consistent with your results, that you have been implementing good risk management.
You Are Disciplined
Another sign that you are ready to join a prop firm is linked with how you deal with losses. It is okay to lose trading now and then. The question is about how the loss will impact your trading ability or your mental and emotional health altogether. Suppose you have been trading a $300 live account, and you have been doing that consistently, along with taking the losses professionally without letting them have an emotional toll on you; then you are ready to become a funded trader.
You Are Not Making Mistakes
The third sign that you are ready to join a prop firm is when you aren’t making consistent mistakes. It is important to mention here that even the most seasoned traders are prone to make mistakes. So, it is okay if you make mistakes at the start of your journey. And when you do make mistakes, these are small mistakes, such as making a trading decision that hasn’t been aligned with your plan but hasn’t caused any big loss. One mistake every couple of months of consecutive trading is all right. However, you shouldn’t be making consecutive mistakes. Also, mistakes aren’t often the problem; how you recover from them is.
You Understand Risk Management
If you have a tested trading strategy in place and you understand the importance of effective risk management, then you are ready to join a prop firm. Effective risk management ensures that you can pave the way for long-term success and emerge as a stable trader in the prop funding landscape.
You Have the Capital to Trade Again
The fifth sign that you are ready to join a prop firm is that you have the capital to try again. Here is the thing: in an ideal world, you would go for the funded account and pass the challenge on your first attempt. However, realistically, this might not happen. So, you should aim that in the next few challenges you set for yourself, you must at least pass one. Challenges are hard, and they are challenges for a reason, which is why you must have the capital to trade again.
Conclusion
Taking these 5 things into account you will know if you are ready to join a prop firm. If you aren’t there, hit the brakes, and reevaluate your strategy. Only when you feel prepared should you start trading for real.