Profit Target

Evaluation & Funding

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According to Vigil's prop trading glossary, Profit Target is the minimum profit a trader must generate to pass an evaluation phase or qualify for a payout. Once hit, the trader advances to the next phase or receives their funded account. In prop trading, understanding profit target is critical because it directly affects your drawdown limits, position sizing, and whether you pass or fail an evaluation.

This term is part of the full prop firm glossary.

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How does profit target work?

Profit targets vary significantly across firms and account sizes, typically ranging from 5% to 10% of the account balance. In 2-step evaluations, Phase 1 usually has a higher target (8-10%) while Phase 2 has a lower target (5%).

The profit target creates a natural tension with drawdown rules. A 10% profit target with only a 5% max drawdown means you need to make twice what you can afford to lose. This asymmetry is intentional -- firms want to fund traders who can generate consistent returns without excessive risk.

There is no time limit to hit the target at most firms (FTMO, FundedNext), but some firms (Apex) require minimum trading days. Once funded, there is typically no profit target -- you trade and keep a percentage of profits.

What does profit target look like in practice?

FTMO $50K Phase 1: profit target is $5,000 (10%). Phase 2: target is $2,500 (5%). You need to grow the account to $55,000 in Phase 1, then $52,500 in Phase 2. With a 5% daily loss limit ($2,500) and 10% max drawdown ($5,000), you have a 2:1 target-to-drawdown ratio in Phase 1.

Why does profit target matter for prop firm traders?

Profit Target determines what stands between your challenge fee and funded capital. Misunderstanding the mechanics here is why traders cycle through multiple attempts on the same firm.

Practical example across firms: FTMO: 2-step, static drawdown, 5% daily loss, from €155. TopStep: 1-step, trailing drawdown, 2% daily loss, from $49.

Common mistake: The most common mistake with profit target: rushing to hit the profit target. Most firms have no time limit. Overleveraging to finish faster is the number one account killer. A slow pass beats a fast blowup.

How do different firms handle profit target?

Understanding profit target is essential when choosing and trading with a prop firm. Compare how different firms handle this:

What terms are related to profit target?

Evaluation Phase

A simulated trading period where aspiring funded traders must demonstrate profitability and risk management within defined rules. Passing the evaluation earns access to a funded account.

Funded Account

A trading account provided by a prop firm after passing the evaluation, where the firm supplies the capital and the trader keeps a percentage of profits. The trader does not risk their own money beyond the challenge fee.

Consistency Rule

A rule requiring that no single trading day accounts for more than a certain percentage of total profits. Designed to prevent lucky one-day windfalls from passing evaluations.

Challenge Fee

The upfront cost paid to a prop firm to attempt an evaluation. This fee grants access to the simulated trading environment and is typically refunded after the trader passes and receives their first funded payout.

Payout Split

The percentage of trading profits that a funded trader keeps versus what the prop firm retains. Typical splits range from 50% to 100%, with most firms starting at 80% and offering increases for consistent performance.

See profit target in action
Where can I learn more?

How to Pass FTMO $200,000

Step-by-step guide

How to Pass TopStep $150,000

Step-by-step guide

How to Pass Apex Trader Funding $300,000

Step-by-step guide

FTMO Trust Score

Independent trust audit

TopStep Trust Score

Independent trust audit

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