Introduction
Prop firms are amazing for traders, but let’s be honest, evaluations are a hassle! Thankfully, many firms now offer an instant funding model that doesn’t require the trader to pass any evaluation to get funded, the trader simply pays the fee and is handed a funded account… Awesome!
Hopefully it goes without saying that prop firms are businesses that need to make profit, so although a trader doesn’t have any evaluation to pass for instant funding accounts, they do still have to meet certain requirements before they can request a payout, and whilst those requirements are generally sensible, they do still typically require the trader to show some ability to make consistent profit before they can request a payout.
In this article we’ll take a look at how the instant funding models differ from evaluation models, and we’ll look at two different variations of the instant funding model that are currently available.
How Instant Funding Programs Differ from Evaluation Programs
Prop firms most often run on the premise that a trader applies for funding via an evaluation, which costs a fee, and if the trader passes the evaluation they are given a funded account that will regularly pay out a percentage of any profits generated. The evaluation is typically conducted over one to three phases, and then if the trader passes the requirements of each phase they are given a funded account.
The evaluation model offers traders a clear path to a huge potential return on their risk if they are able to pass and achieve payouts, but for traders the evaluation phases can be difficult to navigate psychologically, and so there has always been a desire in the industry for instant funding options that don’t require any evaluation to be passed.
Of course, firms can’t just hand out instant funding without any restrictions, it would create too much risk that is extremely difficult to manage on the back end, and so whilst instant funding programs were born, they were born with restrictions such as a higher price, lower profit splits, lower drawdown levels, trailing drawdown, and consistency rules. Typically an instant funded account will have one or multiple of these restrictions.
Here are what I think are the two best instant funding models available at the moment:
Funded Trader Markets Instant Funding Pro
Funded Trader Markets are my favourite new firm, and I can assure you that they are not paying me to say that. I chose to review them last year and I’ve been watching their Discord and social posts closely since. Their customer service is absolutely top drawer, growth has been impressive, and they have some of the fastest payouts in the industry. I am personally funded with them and am extremely happy, so I’m comfortable recommending their instant funding account here.
They have two versions of instant funding, a ‘Standard’ and a ‘Pro’ account. The Standard account is the more expensive of the two, it has a higher maximum drawdown limit, and requires 5 minimum profitable days where the trader makes at least 0.5% profit on each day before an on-demand payout can be requested. It’s a good program, but in my opinion the Pro account is better…
The Instant Funding Pro account is extremely simple to understand: You pay a fee and are given the account. You have 3% max trailing drawdown, which is always trailing the highest balance in the account, no news trading or overnight holding restrictions, and no swap fees. In order to achieve a payout the trader must achieve a consistency score of 20% or lower, meaning the most profitable day cannot account for more than 20% of the profit made during the period, and when a payout is requested the drawdown level is reset which means there is no requirement to leave a drawdown buffer in the account.
Profit splits start at 50% and increase by 10% with each withdrawal until it reaches and remains at 80%.
The5ers Hyper Growth
The5ers are arguably the best prop firm in the industry right now, with their impressive trading conditions, and industry leading scaling plans and educational content, it’s no surprise their Hyper Growth account is one of the best instant funding accounts in the industry.
There’s room for debate around whether or not this is really instant funding or if it’s a one-step evaluation, but for the purposes of this article I will consider it instant funding because once the trader has bought the account their only requirement for payout is to make 10% profit on the account.
The Hyper Growth account is more expensive than the FTM instant funding accounts, but the Hyper Growth account has huge potential if you can take a step back and look at the big picture…
You see, the Hyper Growth account has a 6% maximum drawdown level, which is static, and a 3% daily pause level. There are no news trading or overnight holding restrictions, and with scaling the profit split can reach 100%. The best thing about the Hyper Growth account? It doubles in size every time the trader makes 10% profit… Think about that… You could start with a $5K account and reach a $4 million balance with a 100% profit split after achieving 9x scale ups (90% profit). That is unbelievably good, and it is absolutely achievable for a profitable and consistent trader to scale one of those accounts up to the maximum limit of $4M. Not bad for an initial risk of $250.
Conclusion
Whilst instant funding accounts offer a lower overall potential return on investment than evaluation models, they are still a great way for traders to leverage their skills and money beyond what is possible with a small personal trading account.
Manage risk well and huge returns can be generated from an instant funded account, without the hassle of having to pass an evaluation!
The way I see it there are two instant funding paths that make the most sense. There’s the instant ability to earn relatively large sums of money from the FTM Instant Funding Pro account, or if you can be patient and think of the long game then The5ers Hyper Growth account has particularly impressive potential. It will take longer to start earning large sums of money from a Hyper Growth account, but once it scales past $80K it becomes the most valuable instant funding program in the industry due to the static drawdown and plenty of scaling potential still to come. In fact, why not get the best of both worlds and have both! I might do just that…
Happy trading!
