What Is a Funded Account in Trading?

A funded account is a trading account whose capital belongs to a firm — in the retail market, a prop firm — rather than to the trader using it, operated under written risk rules and a profit split. The trader holds a mandate, not ownership: no right to withdraw the capital, no discretion to exceed the limits, and no account once a limit is broken. Everything else follows from that.

How it works

There are normally two phases governed by the same rulebook. The evaluation is a paid attempt on a simulated account of a stated size, ending when the profit target is reached, a risk limit is breached, or a time window expires. The funded phase begins after a pass. The rules do not relax — usually they are identical or tighter — but realised profit is now split, typically in the trader's favour, and paid on a defined cycle.

Two families of rule decide the outcome, and they fail in different ways.

Loss limits       daily floor, reset each session
                  total floor, static or trailing, never reset
Consistency rule  largest day's profit / total profit <= cap

The loss limits are hard stops. A trailing total floor moves up with every new equity peak — it ratchets in one direction only — so a good week leaves less room than the week before it, and an account can be closed while still showing a profit. The daily floor is the tighter of the two and is tested every session; it has its own entry, the daily drawdown limit.

The consistency rule is discussed less and removes more traders than most expect. It caps how much of total profit may come from one day or trade, on the reasoning that a single outsized position is not repeatable. A candidate can hit the target, break no loss limit, and still fail because 60% of the gain arrived in one afternoon.

Around these sit smaller conditions: a minimum number of trading days, rules on holding through scheduled news or over the weekend, scaling plans that raise the allocation after consecutive payouts. All are contract terms and vary.

Why it matters

A funded account converts risk management from a preference into a pass/fail test. On your own account a 15% drawdown is unpleasant and recoverable. On a funded account with a 10% floor the same path is terminal: the recovery never happens, because there is no account left to recover in.

Which is why the figures a firm cares about are rarely the ones a results page leads with. Return is the headline; the depth and the daily shape of the decline decide whether the mandate survives.

What the data shows

Across the public accounts on ShowMyTrades with trading history, 38.2% have at some point been more than 20% below their peak. Measured against 20% — looser than almost any retail rulebook — close to four in ten would already have failed, and these were trading with no rulebook at all, where nothing forced a position closed. These figures describe accounts published here, not traders in general.

The returns those risks bought: median time-weighted return +3.2%, with 63.0% of accounts positive. The constraint, not the return, is what most candidates run into first.

37 accounts here are unlisted — published at their own link but kept out of every listing, which is the setting a candidate uses to send a record to a firm without putting it on the site.

Where you see it on ShowMyTrades

There is no funded-account module here and no integration with any programme. What the account page provides is the measurement.

The Account Stats panel shows Drawdown, computed on equity so floating losses on open positions are included, next to DD on Balance, computed on closed trades only. That pair matters here more than anywhere: rulebooks generally measure on equity, so a strategy that holds losers open reads well on drawdown on balance and fails on the first figure. The same panel carries Avg Daily % and Avg Monthly %, the baselines a consistency rule measures a standout day against.

The Drawdown view in the charts panel plots, day by day, how far equity sat below the running peak balance — the shape a total or trailing floor reads. For the consistency question, the Monthly Returns table shows whether gain is spread or concentrated, and its Calendar view resolves that to individual days.

Visibility is set per account: published, private, or unlisted — reachable by direct link and excluded from listings. Owners can also hide individual modules, so a page missing a section is a choice rather than an absence of data.

Common misunderstandings

• "Once funded, the money is mine." It is the firm's throughout. Only the paid-out share of realised profit becomes yours.
• "The funded phase is easier than the evaluation." The limits are usually the same or tighter. What changes is that failing now costs an income stream rather than a fee.
• "I only need to avoid the daily limit." The total floor ends most accounts, and a trailing one tightens as you win.
• "A big winning day is progress." Under a consistency rule it can be the reason a payout is refused.

For how these limits behave over a full account history: maximum drawdown explained.

Related terms