It’s very important to maintain expectations real here, and in order to do so we need to be as objective as possible! Consdier expenses, fees, withdrawals, holidays too right?
So you passed the Challenge and you are going to trade you first Funded Account.
In this basic chart is displayed your account:
the blue dashed line is the starting balance of 25k $
the red dashed line is the drawdown limit of -2.5k $, hence at 22.500$
the green line is your performance: with a dip in the first weeks, then recovering and moving up for a nice profit.
What is pretty obvious here is that you need to be as far as possible from the red line: your Max Loss, or drawdown!
What we dream of is that from very first day we are going to be profitable every single day! Look at these great profits we are piling up!
And yet reality is made of losses too!
So I’ve created a completely hypothetical spreadsheet of our performance: every cell displays the daily profit/loss, and every box of 5 cells is a week of trading.
This time we are accounting for losses too: you can see first 2 weeks are in loss, following 3 are in profit, this could resemble the optimal performance of a good trader.
So I’ve repeated than this for 52 weeks to obtain this beautiful and optimistic chart of our first year of trading!
But the reality is that we want to enjoy our life as a trader right? So I’ve added a couple of inactive weeks where the p/l line goes flat, and also 3 withdrawals from our profitable account.
I am myself a Funded Trader with Earn2trade since I participated in and won The Gauntlet at the end of 2018; Earn2trade pays to the profitable funded trader the first 5k he withdraws at a 100%, after that Helios will take its 20% profit share (this could be 30%, based on your performance) monthly: in this chart you can see how the p/l line goes down a little every month after my first withdrawal; the other Funders like Savius take their profit share every time you withdraw; Topsteptrader as well offers the first 5k at 100%, while Oneuptrader goes as far as to 8k at 100%.
I plan on letting my account grow nicely before taking any withdrawal: the further I’ll be from the drawdown the better I’ll trade.
Remember: broker and platform fees have been accounted for in the trading profit&loss, these are taken immediately! While the Data Fee (105$ monthly per product) will need to be paid out by you! Some Funders ask you to pay directly, others will take it from the profit in your account. Obviously the costs for your trading platform are on you.
So while the first unrealistic projection was to grow our Funded Account from 25k to almost 80k in the first year, the truth is that even by being a consistently profitable trader our account will be (remember that this is pure speculation) closer to 37k at the end of the first year: but you enjoyed 2 weeks of holiday, and a nice 15k$ withdrawn in your bank account!
Furthermore you have 1 full year of trading with real money under your belt, while you had zero risk on your savings! Not a bad experience right?
The following year you will keep your successful strategy exactly as is and yet perhaps make the most of this growing account to, let say, double your size in contract? That is double your profit!
So year 2: 2 weeks of holiday, and 30k $ withdrawn!
The sky is the limit! Don’t be greedy, use your wisdom, and your life will be fulfilled and happy.
Remember my mantra: