Compound Growth Calculator
Small consistent daily returns compound into significant growth over time. See what your target daily return produces over 30, 90, and 250 trading days. Pick a firm to model growth against their specific account sizes.
Compounding in Prop Firm Trading: The Real Math
The compounding numbers look impressive in theory. 0.5% daily for 250 trading days produces 249% growth. The problem is that no trader achieves positive returns every single day. The real compounding question is: what does your average daily return net of losing days look like?
If you make 0.5% on winning days but lose 0.3% on losing days, and your win rate is 60%, your net daily expectancy is (0.6 x 0.5%) - (0.4 x 0.3%) = 0.18% per day. That still compounds to 56% over a year. Modest but consistent. Compare that to a trader going for 2% daily who takes 1.5% losses -- same 60% win rate gives expectancy of 0.6% daily. Looks better, but the volatility is far more likely to breach a prop firm daily loss limit on bad days.
The prop firm constraint changes the compounding calculus. Preservation of the account is more important than maximizing daily return. A trader who earns 0.3% daily for 90 trading days without a breach is worth more than one who earns 1% daily but fails two evaluations along the way.
Frequently Asked Questions
Can you compound profits on a prop firm account?
Yes, but it depends on the firm and phase. During the evaluation phase you generally cannot withdraw, so profits compound within the account balance. Once funded, most traders withdraw regularly rather than compounding aggressively, because a larger balance means larger absolute drawdown exposure. The compounding effect is most powerful if you use profits to buy bigger account sizes.
What is a realistic daily return for prop firm traders?
Consistent prop firm traders typically target 0.3-0.5% daily return on their risk capital. A 1% daily return sounds modest but compounds to over 1,000% annually -- which is why most traders focus on consistency over maximizing daily returns. FTMO requires 10% in 30 days (phase 1), which works out to about 0.33% per trading day.
How long does it take to compound a $10K account to $100K?
At 0.5% daily return on 250 trading days per year: Year 1 ends at $34,850. Year 2 ends at $121,000. At 0.3% daily, Year 3 ends at roughly $100,000. These projections assume no withdrawals and no losing days, which is unrealistic -- but the math illustrates why consistency beats occasional big wins.
Should I reinvest prop firm payouts to compound growth?
Reinvesting payouts into larger funded accounts is the standard compounding strategy for prop traders. Most firms let you scale up account size once you prove consistency. FTMO offers account scaling up to $2M. The strategy: pass evaluation, get funded, stay consistent, use payouts to fund larger accounts, repeat.