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The Pros and Cons of Funded Trading explained

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You know what funded trading is, but you’re just trying to figure out if it’s right for you? Let’s quickly lay out what the pros and cons of funded trading are!

Let’s start with the pros of funded trading

Access to capital

Funded trading accounts are often funded with more than $10,000. At Funded Crypto Trader, our largest funded account is $100,000 and you can scale up to $400,000!

Many crypto traders don’t have this sort of capital themselves. Becoming a funded crypto trader means they (and you!) can get larger profits than they would normally have access to.

You are trading risk-free when trading with a funded trading account

risk-free? Yes! You are trading someone else’s money so any loss you incur is not your own. You don’t lose anything. Sure, your funded trading account will reduce in size, but it’s not your money!

Surrounded by your peers

This might be specific to Funded Crypto Trader but with our funded crypto trader program you can get support from other funded crypto traders in the program. How? By joining our discord!

Why is this a pro? Crypto trading can be lonely. Being able to chat with other traders who do what you do is always nice! You’ll be able to bounce ideas off each other, and get some insight into different strategies. There’s no need to go on this journey alone.

You no longer have to look for clients

You might have thought about being a portfolio manager for other people. This is not easy.

You need to find people who are interested in someone else trading their capital and they also need to trust you. Furthermore, you will have to deal with constant phone calls and e-mails whenever the crypto market is down.

Remember those “How’s your crypto doing?” texts any time bitcoin dips? Just imagine that, but ten times worse. With our Funded Crypto Trader program, you can trade in peace!

Your location doesn’t matter for funded trading

Every country has its own rules and regulations for trading. As it stands, crypto regulation is still being worked on but forex trading has been regulated for quite some time.

A lot of crypto traders in the US will find that they cannot trade with certain brokers. It doesn’t matter if you only want to trade crypto pairs. The regulations will stop you from being able to sign up with that broker. This is one of the biggest pros of funded trading!

After you’ve been accepted into a funded trading program you are trading with the fund’s money and not your own. This means the regulations are no longer an issue!

Let’s dive into the cons of funded trading

You need to pass a funded trading test

Funded trading programs won’t just accept anyone. While they don’t do what prop firms do ( needing a degree, interning for a year, proving their track record, etc), they still want to make sure their traders know what they’re doing. Therefore, they make them take a trading test.

You pay a fee, take the challenge and if you pass – tada! Now you are a funded crypto trader.

Drawdown limits

Drawdown limits are there to protect the funded trading program’s funds. They can’t risk every trader blowing their account, so there are drawdown limits in place.

The upside is that when traders show they are profitable, these drawdown limits get adjusted. Every funded trading program is different so make sure to check what the rules are for the program you’re going with!

Profit share

The biggest con of funded trading is the profit share. Unfortunately, you do not get to keep all the profits. Here at Funded Crypto Trading, the profit split is 80-20. You get 80% of the profits and we keep 20%. That’s still a pretty good deal if you ask us!

The idea of losing someone else’s money could stress you out

On one hand, not risking your own money is great. But on the other hand, many people feel bad for losing someone else’s money. . When you are trading with a funded trading account the money is not yours. Stress causes traders to make mistakes. Just know that funded trading programs don’t care. They have drawdown limits in place to limit their risk precisely for this reason.

The pros and cons of funded trading

Pros of funded trading

  • Access to capital
  • Risk-free trading
  • Surrounded by your peers
  • No clients
  • Location doesn’t matter

Cons of funded trading

  • You need to pass a test
  • Drawdown limits
  • Profit share
  • Losing someone else’s money can be stressful

As you can see the pros far outweigh the cons of funded trading (although we might be biased here). If you feel like funded trading is the right move for you give our challenge a go!