Online prop firms are a great way for traders to scale their capital and increase their profits in the markets without needing to find investors or compound their accounts for many years.

However, prop firms can be expensive, and not everyone can afford them; furthermore, some traders want to take more than one trading challenge to obtain funding, which can get very pricey! This begs the question, what is the cheapest prop firm?

The cheapest prop firm is The5ers, 2 step $5000 account, which costs traders just $39, making it the cheapest funding option on the market.

In this article, we’ll explore the 5 cheapest forex prop firms, the cheapest stock prop firm, and the fees you’ll be paying your prop firm. So, let’s get into it!

What Are The Cheapest Prop Firms?

Even consistently profitable traders may need one or two extra prop firm challenges to get funded as the market conditions may not be great for their trading strategies at the time of their challenge.

Therefore, ensuring you’re working with a cost-effective prop firm will save you a lot of money and headaches and hopefully allow you to take multiple challenges if needed, in order to obtain the funding you’re looking for!

The Top 5 Cheapest Forex Prop Firm

We will keep this constantly updated to reflect pricing within the market, but currently, these are the top 5 cheapest prop firms for forex traders:

1. The5ers - $39

The5ers offers the cheapest prop firm challenge in the industry, with $5000 of trading capital for just $39. This is the 2-step. The5ers know for their high reputation and their great trading condition.

2. MyForexFunds - $49

MyForexFunds offers the next cheapest prop firm challenge, coming in at just $49 for $5,000 in trading capital. This is a 2 step challenge account.

3. TheFundedTrader - $65

TheFundedTrader offers a very similar $5,000 funding trading account for just $65. This, again, is a 2 step challenge model account.

4. MyForexFunds - $84

MyForexFunds are back on the list with a $10,000 account for just $84. This is the same account model as their $5,000 account at second place but with twice the trading capital!

5. Finotive - $75

Finotive offers a very similar $5,000 funding trading account for just $75. This, again, is a 2-step challenge model account.

The Cheapest Stock Prop Firm

If you prefer trading the stock market, there are few stock prop firms that offer funds, especially for stock traders.

1. Trade The Pool - $97

Trade The Pool is currently the cheapest and best stock prop firm on the market, coming in at just $97 for $20,000 of buying power and great trading conditions. You can trade more than 12,000 stocks and ETFs and even short any penny stock.

The Types of Fees You Pay to Prop Firms

There are more ways online prop firms charge traders for their service and capital. These include:

2. Trading Challenge Fees

All online prop firms charge traders a fee to take a trading challenge to prove they can consistently and profitably trade the markets. If they’re successful, the trader will be allocated an amount of capital to trade with!

3. Performance Fees/Profit Splits

The large majority of online prop firms will offer traders a profit split. The amount of profit split greatly depends on the prop firm you’re working with, but it typically ranges from 50%-90%. For example, if you were working with a prop firm on a 90% split and made a $10,000 profit that month, you’d keep $9000, and the prop firm will take $1000.

4. Trading Conditions (Spreads, Commissions, and Slippage)

Prop firms will charge you a spread and/or commissions for your trades within the market, exactly as a forex broker would. This is a completely standard within the industry, and it’s usually a negligible amount in comparison to your trading profits unless you’re a high-frequency trader/scalper.

5. Monthly Account Fees

Some prop firms charge a monthly fee to keep your funded trading account. We’ve seen this model slowly dying out over the last 6-12 months but looking back 2-3 years; this was the most popular model!

Comparing Costs & Benefits

Now we have identified the 5 cheapest forex prop firms, let’s take a deeper look at their offerings to guide your decision as to which firm may be right for you!

Tips for Choosing the Right Prop Firm

Just because a funded trading account might seem great or a prop firm is really affordable - this doesn’t mean they’re the right prop firm for you!

There are several factors you should consider when choosing the right prop firm to be working with. These factors include:

1. The Reputation

With prop firms popping up every day, it’s crucial to work with a prop firm with a long-term, established reputation in the industry. The better the reputation, the less likely the prop firm will go bust overnight, leaving you high and dry with no funding!

For reference, The5%ers has over 1300 reviews on Trustpilot, rated 4.8/5!

2. Affordability

Affordability and pricing play a big factor. If you’re coming into the markets with just $500, you don’t want to work with a prop firm that charges $500 for a challenge account. Working with a much more affordable option would be more suitable because if you fail the challenge, you'll want to have the opportunity for a second chance.

3. Support For Traders

It’s important to consider what kind of support traders are offered by a prop firm. Are they offering mentorship, training material, useful insights, and fast customer support, or are they just leaving traders to fend for themselves using a cheap outsourced live chat feature?

Believe us, once you’re funded, this will be a big factor for you!

4. Alignment With Your Trading Strategies

The prop firm must align with your trading strategies. For example, some prop firms do not allow traders to hold trades over the weekend. If you’re a swing or position trader, you will not be able to trade your strategies with that firm effectively.

There are prop firms catered to every trading style, so you need to find the one that best suits your trading style!

5. Capital Scaling Opportunities

It’s important to think long-term. Does the prop firm you’re considering allow traders multiple trading accounts? Are there opportunities to compound your trading account? Is there a way you can grow your capital (scaling plan) under management without the need to work with an additional prop firm?

These are incredibly important factors to consider!

In Conclusion - What Is the Cheapest Prop Firm?

In summary, the cheapest prop firm offering is The5ers $5000 account at just $39. Putting pricing aside, it’s important for traders to look at other aspects of the prop firm they’re looking to work with, to establish whether they’re the right fit for them!