Prop Trading Tips & News: MyFundedFX absorbs SwiftFunding

Hi Boris, here’s what is buzzing in the prop trading industry for May 3, 2024

🗞️ TODAY’S PROP TRADING INDUSTRY NEWS

1. MyFundedFX acquires & absorbs SwiftFunding (details)

2. Goat Funded Trader teases new platform additions in May (MetaTrader or TradeLocker)

3. Bespoke Funding adds cTrader

4. FundedNext rolls out cTrader as new platform option

5. FundedNext introduces Pass Aid trading tool

✂️ LATEST PROP FIRM DISCOUNT PROMOTIONS

• Axi Select ⭐ Get Funded 10% FREE

• ATF (Apex Trader Funding) 80% off any size evaluations ⭐ “SAVENOW” code

• City Traders Imperium $10 Get Funded Offer 

• FXIFY 1 year anniversary 20% off sales + 3 FREE add-ons

• Goat Funded Trader 11%-15% Off Challenges + 1 Free MTJ Month

🎓 PROP TRADING TERMINOLOGY

What is the Consistency Rule?

DEFINITION: Some prop firms have a consistency rule that states no single trading day can make up more than a certain percent of your total profit. This percentage varies by firm and can range from 30% to 45%

Example: Let's say you're a trader at XYZ Proprietary Trading Firm, and they have a consistency rule where no single trading day can make up more than 40% of your total profit. Here's an example to illustrate how this rule works:

Suppose your total profit for the week is $10,000. According to the firm's rule, no single trading day can contribute more than 40% of this total profit.

• Monday: You make $4,000 in profit.

• Tuesday: You make $3,000 in profit.

• Wednesday: You make $2,000 in profit.

• Thursday: You make $500 in profit.

• Friday: You make $500 in profit.

Now, let's calculate the percentage of profit each day contributes to the total profit:

• Monday: $4,000 / $10,000 = 40%

• Tuesday: $3,000 / $10,000 = 30%

• Wednesday: $2,000 / $10,000 = 20%

• Thursday: $500 / $10,000 = 5%

• Friday: $500 / $10,000 = 5%

In this example, no single trading day exceeds the 40% limit set by the firm's consistency rule. If it does, you do not pass their challenge.

📈 MIND OVER MARKETS

Behavioral psychologists have proven beyond a shadow of a doubt that we have a finite mental budget for decisions. When we are overwhelmed with choices we tend to simply freeze and perform poorly.

This is the reason why you can be up 100 pips by noon only to give up all the profits by the end of the day. 

If all of this sounds familiar, it's because it is inevitable given how our minds are built. Most traders, when faced with such disappointment, will usually blame their strategy but almost always this is the  wrong diagnosis.  How many times have you abandoned your strategy only to realize many months later that it would have performed great had you stayed with it? 

Strategy failure can certainly happen, but most of the time in day trading the root of all your troubles lies in decision fatigue. 

One solution is to simply put a limit on the number of trades you will make. Set a goal of 20 pips - and if you achieve it with the first two trades of the day, shut down your screen and walk away. Or set a goal of 10 trades maximum per day and once you reach it close your platform and walk away regardless of whether you are up or down.

Behaviorally this is the best approach. But it is a lot easier said than done. The siren song of the markets 📈 is very seductive making it very hard to pull away from the screen especially during times of high volatility. There is always one more set up. There is always one more opportunity to trade. 🤑

Setting hard targets whether it be in pips or trades or hours of trading is ideal, but often we need something more to combat decision fatigue - and here is one trick you could use.

Accept the fact that day trading is the art of making 1% over one hundred trades.  This may be a  bit of an exaggeration, but not much, and it is a very useful mental model to have because it turns every trade into a micro decision so light, so immaterial that it almost doesn’t exist. Think of each trade as a piece of gum that you have sitting in a box on your table.

You may go through twenty pieces of gum in a day without giving it a second thought. You don’t care how much they cost, you don’t care how long you’ve chewed them, you don’t care how many you’ve chewed. They are pieces of gum. In the grander scheme of things they are meaningless and therefore the decision never taxes your brain.  

If we look at each trade as essentially a Chicklet - a meaningless little burst of flavor rather than a source of all our happiness and misery - we would be a lot better off. 

When you listen to interviews of the greatest traders in the world, what you often discover is that their strategy is just a tiny part of their success.   Instead, it’s their ability to sidestep decision fatigue, to treat each trade as a meaningless piece of gum, that is the true source of their winning ways.

📌 PASS THE PROP TRADING TIP

If you are looking to pass the prop, day trading is better than swing trading for one big reason – DRAWDOWN. With limits like 5%, day traders are more able to respond to market fluctuations, monitor positions closely, limit exposure to volatile markets and minimizing the risk of exceeding drawdown thresholds. Day trading aligns well with these limits as traders can closely adhere to the predefined risk parameters on a daily basis. By consistently limiting the duration of trades and exposure to market fluctuations, day traders can maintain compliance with drawdown limits set by prop trading firms, thereby increasing their chances of passing trading challenges. Some firms also have consistency requirements that is easier to meet by day trading than swing trading. Overall, the agility and precision of day trading aligns better with the strict risk management requirements of prop trading challenges, enhancing the likelihood of meeting and exceeding performance benchmarks.

📋 PROP FIRMS THAT ALLOW MARTINGALE TRADING

1. Axi Select

2. FTMO

3. The 5ers

4. MyFundedFX

5. FundingPips

🔥 MORE TRADING TIPS

⚡ PROP FIRM FEATURE

SPONSORED BY AXI SELECT

First 100% Free Funded Trader Program

Axi Select is the first FREE Funded Trader program giving you the access to trade up to $ million US Dollars. Axi is one of the leading brokers in the world and their capital allocation program is focused on your success. It is 100% free to join, no registration fees or monthly fees. You can earn up to 90% of profits and you get assigned a personalized Edge score that measures your trading skill, risk and consistency. JOIN AXI SELECT

🔥 OUR PICK: HOW DID YOU PASS THE PROP?

❤️ SHARE WITH A FRIEND

Thanks for reading. If you liked today’s prop trading coverage, we’d love for you to share with a friend https://proptraderedge.beehiiv.com/subscribe

Have an awesome day 😉