How you lose the account
In both firms, the most common way to lose an account is breaching the drawdown limits (daily or maximum). However, there are other technical traps:
- Inactivity: Both firms will close your account after 30 days of inactivity. At Funding Traders, this 30-day clock starts the moment you buy the account, not from your last trade.
- Consistency Rule: Both firms use consistency rules to prevent "gambling" on a single event. If one day’s profit represents too much of your total gain, you must continue trading.
- Strategy Violations: Funding Traders is much stricter regarding EAs. While FTM allows them generally, FT only permits EAs for risk management (calculators). Using an off-the-shelf EA at FT will result in account loss.
- Prohibited Trading: Both ban arbitrage and HFT. FT specifically bans "one-sided trading" (stacking positions to hit targets).
Maximum drawdown
The maximum drawdown defines the total life of your account.
- Funded Trader Markets: Uses a trailing drawdown for its Instant and 1-Step Nitro accounts, but a static drawdown for 2-Step Plus accounts.
- Numerical Example: In a $100,000 1-Step Nitro account (6% trailing), your floor starts at $94,000. If you reach a balance of $102,000, your new floor is $96,000.
- Funding Traders: Also uses a mix. 1-Step Pro is 10% trailing. 2-Step Pro is static (6% or 10%).
- Numerical Example: In a $100,000 2-Step Pro10 account (10% static), your floor is fixed at $90,000. Even if you grow the account to $150,000, you only lose the account if you drop back to $90,000.
Daily drawdown
This is the most sensitive rule because it resets every 24 hours.
- Funded Trader Markets: Uses an EOD (End of Day) High-Watermark. This means the limit is calculated based on the highest balance or equity recorded at the end of the day.
- FTM Example: If you have a $100,000 account and end the day at $105,000, your 4% daily limit for the next day is calculated from $105,000 ($4,200 max loss), not the initial $100,000.
- Funding Traders: The calculation varies by account. For Pro accounts, it is 3% or 5% based on the starting day's balance. For Instant accounts, it is based on the higher of the starting day's balance or equity.
- FT Example: In a $100,000 Pro10 account (5% limit), your daily loss limit is always $5,000 below the balance you started the day with. If you start at $100,000, you cannot drop below $95,000 that day.
Rules beyond drawdown
Risk management at these firms involves more than just price levels:
- Consistency Score: At Funding Traders (Pro), your best day cannot exceed 50% of total profits. At FTM, the rule varies: 25% for 1-Step Nitro X, and up to 50% for 1-Step Nitro.
- Risk per Trade Idea: Funding Traders imposes a hard limit of 2% risk per trade idea on Pro accounts. A "trade idea" includes all positions in the same direction on the same symbol.
- Shield Risk Protocol: FTM has a specific rule for "Plus" accounts where the maximum floating loss cannot exceed 1% of the balance. Breaching this doesn't immediately close the account but permanently reduces your profit split.
- Stop Loss: Neither firm explicitly forces a Stop Loss on all trades in their JSON data, but FTM requires them if you want to qualify for a "profit breach" payout (withdrawing 50% after a violation).
Risk that comes from the setup
The "environment" risk includes execution and timing:
- Platforms: FTM offers MT5, cTrader, TradeLocker, and MatchTrader. Having more options like cTrader can reduce the risk of execution errors compared to firms that only offer newer, less stable platforms. FT only offers MT5 and TradeLocker.
- News Trading: This is a major differentiator. FTM allows news trading. Funding Traders prohibits it on Instant accounts (instant termination if a trade is open during news) and limits news profits to 30% on Pro funded accounts.
- Slippage: The JSON does not provide specific slippage data for either firm. This is a "hidden risk," as high slippage during news or volatile markets can cause a drawdown breach even if your stop loss was set correctly.
What is at stake and what you recover
The price of the challenge is the immediate risk capital.
- Entry Cost: For a $100,000 account, FTM's 1-Step Nitro is $622, while FT's 1-Step is $539. However, FTM's 1-Step Nitro X ($150k for $347) is significantly cheaper but carries a $165 activation fee.
- Refunds: FTM refunds after the 3rd payout (not available for Instant or Nitro X). FT refunds on the 1st or 2nd payout depending on the account type.
- Minimum Payout: FTM requires a minimum of 1% profit. FT requires a minimum of $200 (Rise) or $50 (Crypto).
- Payout Fees: FTM charges a 5% fee on crypto payouts, which is a direct loss of realized profit. FT does not list a specific percentage fee for crypto in the provided data.
Frequently asked questions
Which firm has a higher risk of account termination during news, Funded Trader Markets or Funding Traders?
Funding Traders carries a much higher risk during news events. In their Instant Funded accounts, having any open trade during a high-impact news event results in immediate account termination. Even in their Pro accounts, news profits are capped at 30%. Funded Trader Markets, by contrast, allows news trading without these specific restrictive breach conditions.
Is the daily drawdown calculation more dangerous at Funded Trader Markets or Funding Traders?
Funded Trader Markets uses an EOD High-Watermark, which can be more dangerous for profitable traders because the loss limit "tightens" as you make money at the end of each day. Funding Traders uses the starting day's balance for Pro accounts, which is generally more predictable, although their Instant accounts also factor in equity, increasing the risk of a breach during floating volatility.
Which firm allows more flexibility with Trading Bots, Funded Trader Markets or Funding Traders?
Funded Trader Markets is significantly more flexible. They allow EAs and scalping generally. Funding Traders has very strict rules: they only permit EAs developed personally by the trader or those used strictly for risk management. Off-the-shelf or automated trading bots purchased online are prohibited at Funding Traders and will lead to account loss.
Which is cheaper to lose in terms of initial investment for a $100k challenge, Funded Trader Markets or Funding Traders?
Funding Traders is cheaper for a standard 1-step $100,000 challenge, costing $539 compared to $622 at Funded Trader Markets. However, if you are looking for the absolute lowest cost per dollar of capital, Funded Trader Markets offers a $150,000 "Nitro X" account for $347, though it comes with a much tighter 3% drawdown and a mandatory $165 activation fee after passing.
