FTMO Review: Is it Really the Best Way to Raise AUM?

Many traders like myself have the necessary experience and knowledge to trade profitably. You might have discipline and a strategy that works. However, not all of us have a minimum of $10,000 to trade on. This number might be the least capital required for you to make ends meet with trading. That’s where top prop trading firms like FTMO come in. In this article, I’m going to provide an FTMO review based on my own experience as an FTMO trader.

I’ll begin the article by explaining what FTMO is and how it works (and prop firms in general). Then, I’ll demonstrate the FTMO prop firm’s value proposition and why traders go for FTMO funding. Finally, I’ll take a look at FTMO reviews by users, give my own verdict, and introduce an FTMO alternative for traders who are not satisfied with prop firm trading and are seeking another method to raise AUM.

What Is FTMO?

To understand what the FTMO prop firm is and how it works, we first need to analyze what prop firms are in general. Prop trading firms or funding companies claim to offer significant AUM to profitable retail traders. So, if you have a consistently winning strategy, they will provide you with trading capital. Of course, this is if you prove your profitability. Moreover, they also take a share of your profits for their compensation as investors.

FTMO is the most popular and reputable prop firm in the trading industry. Even if you’ve not tried to go down the prop firm rabbit hole, I’m sure you’ve heard of FTMO several times. FTMO offers traders with loaded accounts to trade on if they prove their competence in the FTMO challenge. Upon passing, they will then take a specific share of the profits made on the account as performance fees.

While this is a very tempting offer, all prop firms work like this. However, what has made FTMO so huge is its great reputation and widely-known reliability. So, FTMO is arguably the best prop firm available. Yet, does it mean that it’s also the best way to raise AUM as a pro trader? We’ll answer this question soon.

What Is an FTMO Challenge?

An FTMO challenge is essentially like a test. You will pay a specific amount to take part in the FTMO challenge and prove your profitability. The FTMO challenge price is, of course, dependent on the size of the account you’ll go for. Moreover, the FTMO evaluation is a two-step challenge, and you need to pass both to get funded.

If you pass the FTMO challenge, you will be granted a funded account with the pre-specified amount to trade on. From this point on, every dollar you make on the account will be shared between you and the FTMO prop firm. But let’s not get ahead of ourselves and analyze the FTMO challenges in more detail.

What Are FTMO Challenge Rules?

Well, you might be asking, how does FTMO evaluate me? Well, there are certain FTMO challenge requirements and targets that you should follow and achieve in order to pass the challenge. Here’s a quick look at the FTMO challenge rules: 

So, for example, if you purchase a $10,000 challenge, you will have to follow these rules:

• You have no time limit to pass the challenge.
• According to the FTMO minimum trading days rule, you should trade each phase at least 4 days before moving on to the next.
• If you experience a daily drawdown of more than $500, you will lose the challenge.
• If you experience a total drawdown of more than $1,000, you will lose the challenge.
• In the FTMO challenge (step 1), you should gain $1,000 in realized profits to move on to the FTMO verification phase.
• In the FTMO verification (step 2), you should gain $500 in realized profits to become a funded FTMO trader.
• Note that the drawdown rules don’t change between steps and are also a part of the FTMO funded account rules. You should not break the drawdown rules in any phase to avoid losing your challenge or FTMO funded account.

How Does the FTMO Funded Account Work?

Upon passing the FTMO challenge and going through a KYC process, you will receive the credentials to your funded account. You will then be able to trade on the provided capital and receive up to 90% profit share.

Yet, let’s clear a popular misconception. The FTMO funded account or that of any prop firm is not a real account. This means that you are still trading on a demo account, but you will be paid with the amount of demo profits you earned in real money.

Now, you might ask, how does the FTMO prop firm make money in this process if the profits I gain are not real for them? Well, prepare for the controversial stuff surrounding prop firms.

Prop firms typically do not allow you to trade on real capital. So, the profit share is just a number for them. However, the prop firm business model and revenue are based on the challenges you purchase and fail. This means that prop firms like FTMO make money when you lose a challenge, so they should not refund the FTMO challenge price. This is where their income comes from.

Now, considering the statistics, more than 90% of traders fail to reach their first payout and fail the challenge. So, prop firms like FTMO make money off of the 90% losing traders, not the profitable ones. I know this is very controversial and ethically wrong for many. But it’s the reality.

FTMO Reviews by Real Users

Many traders are aware of the controversial facts I stated above. Even if you were not, now that you know these facts, you might be asking questions like “Is the FTMO Forex funded account real and worth my time?” or “Is FTMO Trustworthy?”. Well, to answer these questions, let’s take a look at popular online forums like Quora, Reddit, and Trustpilot.

FTMO Reviews on Reddit

The prop firm is generally well-regarded, according to FTMO reviews Reddit users shared. To answer the question “Is FTMO Legit?” users have pointed to the fact that FTMO offers you significant capital to trade on, with no financial risk once funded. Moreover, they claim that FTMO payouts are quick and consistent. So, if you wonder, “Can FTMO be trusted?” the answer is yes, according to Reddit users.

Meanwhile there are also negative FTMO reviews on Reddit, pointing out the challenging rules regarding drawdown, which limits the flexibility in implementing some strategies. Some even consider FTMO challenge requirements as unrealistic, as not everyone is able to minimize unrealized drawdown. So, this makes achieving FTMO funding very difficult to many types of traders.

FTMO Prop Firm Reviews on Quora

I’ve also analyzed some questions and their answers by users on Quora. Traders have asked questions like “Is the FTMO forex funded account real and worth my time?” and “Is FTMO a serious prop firm?”. Well, FTMO Quora reviews are mixed. Many users claim that FTMO is legit and valuable for disciplined, profitable traders.

Yet, some FTMO prop firm reviews on Quora claim that the company operates in a way that can be misleading and unfair. Some even consider prop firms in general to be like casinos due to the fact that they make money when you lose. A few users also mentioned how challenge prices, like the FTMO $100,000 account price which is $540, are higher than other prop firms. Yet, there is no feedback that claims FTMO scams people or is fake, indicating that FTMO is legit.

FTMO Reviews on Trustpilot

Trustpilot FTMO prop firm reviews are generally positive. Users praise FTMo’s transparent operations and reliable payouts. Similar to positive FTMO reviews on Quora, users suggest that FTMO is trustworthy and helpful for consistently winning traders.

Yet, negative FTMO Trustpilot reviews again point to strict rules and the difficulty of passing the challenge, which can result in financial loss if not carefully managed. Nevertheless, FTMO’s overall grade on Trustpilot has typically been around 4 to 4.5 stars out of 5, indicating a generally favorable reception from users.

My Personal FTMO Review as a Trader

As a trader who has used prop firms, I personally believe FTMO is legit. Yet, it’s definitely not for everyone. In fact, the whole prop firm industry is somehow designed for day traders with strategies that limit risk and drawdown.

I also believe the FTMO challenge price is high. However, with occasional FTMO sales or FTMO challenge discount codes available on the web, you can lower the price. Winning FTMO competitions is also a method for getting free challenges. But of course, it’s not easy.

Now, while I believe FTMO to be the most reputable prop firm, I prefer to be a real asset manager, trading real funds for real investors. This is primarily because there is a ceiling for FTMO and prop firm traders. Moreover, FTMO news trading rules are also annoying to me, as my biggest wins are during high-impact news. There is also no FTMO HFT account available for algo traders. In fact, high-frequency trading is not allowed on FTMO.

As a result, if you want to have your own hedge fund and manage multi-million dollar portfolios however you and your investors like, there are better alternatives. This is, of course, if you are a profitable trader with a proven track record.

Finestel: The Best FTMO Alternative

As you might already know, I’m not just a content writer. I’ve also been trading for over 6 years now, and growing my AUM has been my number one concern since I became profitable a couple of years ago. I also prefer to have real clients and not have a limited maximum allocation that FTMO funded account has.

This is why I prefer using copy trading solution providers like Finestel. Yet, Finestel is not like other copy trading platforms. Traders who already have investors can quickly start their own hedge fund with our white-label copy trading service. You can manage crypto portfolios for hundreds of investors, use advanced portfolio trackers and performance metrics, and also set flexible performance fee structures and automate your billing and profit sharing on Finestel.

You might ask, what if I don’t have any clients? Well, on Finestel’s strategy marketplace, you can present your strategy and its history, and investors, or even other traders, can choose to invest in you by copying your trades. If you also lack a profitable strategy, you can follow strategies offered by other traders on Finestel’s strategy marketplace.

If you also want to build trust and grow your brand in the trading industry, our white label service allows you to create an almost fully customizable webpage and dashboard branded with you own logo in no time. We manage all the operations to set up your digital crypto hedge fund, so you can stick to what you do best; trading.

Click here to start your asset management business right now using Finestel.

FTMO Pros and Cons

You are now aware of what real traders think about FTMO and what it best alternative is. However, to wrap up our FTMO review, let’s quickly review FTMO pros and cons.

Benefits

There are several advantages to trading with a top prop firm like FTMO. Here are the most prominent:

• Highly Reputable: As I mentioned multiple times in this FTMO review, the company is the most reputable prop firm available today. You will probably not hear about any FTMO scams or fraudulent activities.
• Magnify Income with Minimal Risk: If you manage to achieve the FTMO funded account, you will be rewarded with significant capital which will lead to larger profits. There is also no risk after you become a funded FTMO trader.
• High Profit Sharing Ratio: FTMO offers one of the highest profit-sharing ratios in its payouts, reaching up to 90%. This is a very high number, which is almost non-existent in the asset management industry.

Drawbacks

Now, as I told you earlier, prop firms like FTMO are not for everyone. Here’s a quick recap of its disadvantages:

• Expensive Pricing: FTMO challenge prices are arguably the highest in the industry. This is, of course, because of its positive reputation and significant popularity.
• Maximum Allocation: You cannot manage more than the FTMO max allocation which is $400,000. This is a problem for traders who want to manage seven figure portfolios.
• No News Trading: According to the FTMO news rule, trading high impact news is not allowed on FTMO funded accounts (except swing accounts).
• Drawdown Rules and Profit Targets: FTMO and other prop firms have strict maximum drawdown rules. FTMO challenge profit targets are also hard to achieve.
• Demo Trading Only: You will not manage real capital with FTMO or other prop firms (except by getting an FTMO Quantlane account, which is very hard).
• Country Restrictions: There can be no FTMO US clients or from other countries who are sanctioned, as the prop firm does not serve them.

Conclusion

The number one issue for most profitable trader around the world, especially those with limited capital or living in third-world countries, is growing their AUM. Prop firms like FTMO are designed to solve this problem. In this FTMO prop firm review, I delved into the details of how FTMO works and provided my own experience as someone who used prop firms.

Meanwhile, I also presented Finestel as an alternative to FTMO for more serious traders and asset managers. With Finestel, you can set up your own crypto asset management business in no time and attract investor capital. Our white label copy trading service can help you grow your brand and have your own digital hedge fund.