By James William 
If you have decided to finally take on a prop firm challenge, that’s great. It can be a high-pressure situation where you fight for a funded account. The concept itself might sound simple enough. All you have to do is prove that you can trade, and then you get access to real capital. But behind all of this is a set of rules and expectations that you have to follow. Let’s break down the evaluation criteria that you might face in a prop firm challenge, so you know exactly what is expected.
Why Do Prop Firms Set These Rules?
Let’s get this out of the way. Prop firms are not trying to make your life miserable. The evaluation criteria are there to answer one core question: Can this trader manage risk and stay consistent? Because the truth is, funding a trader who just got lucky on one trade is not really a smart business move. Firms want skilled traders who can preserve capital, use and grow it responsibly, and stay in the game for the long term. That is why these rules exist, and why breaking them can cost you the challenge.
Profit Target
A prop firm challenge will usually require you to hit a specific profit target within a set number of days. It shows that you can grow the account with control, not just luck or oversized risk. A good tip is to not rush. Many traders fail because they try to hit this target earlier and end up losing. Slow and steady is actually encouraged.
Drawdown Limit
This is the maximum amount that you are allowed to lose in a single trading day. If you cross it even by a few cents, you might lose the challenge. For example, if your daily drawdown limit is $500 and your equity goes $501 below the high, even for a second, you are out. This proves that you can stop losses, control your risk, and avoid revenge trading.
Minimum Trading Days
You might think that passing the challenge in one week is impressive. But most prop firms want to see consistency over time. A typical rule is to trade for at least 5 days during the evaluation. However, some firms do not have any such rules. But this shows whether you are disciplined or not.
Use of EAs, Copy Trading, or AI Tools
Some firms allow EAs (Expert Advisors), while others do not. Some want you to trade solo, so you can’t use mirror trading or an AI doing your trades for you. If you are caught ignoring these rules, you can be disqualified even after you pass the challenge. It pays to read the terms. Ask questions and don’t assume anything.
Conclusion
Every prop firm challenge comes with a slightly different set of rules, but the core principles are the same – you have to protect capital, show discipline, and not rely on luck. Understanding the evaluation criteria before you start is crucial. A lot of good traders fail because they did not take the time to fully read the rules, despite being good at trading. So, take your time and be intentional.