Prop trading, short for proprietary trading, is booming across Australia right now.
More traders are discovering they can access capital, scale returns, and fast-track careers without putting their own money on the line.
But there’s a catch: not all prop firms are created equal. And most traders don’t really know what they’re signing up for.
I’ve worked inside brokerages for nearly two decades. I’ve seen the prop model evolve, and I’ve seen where most traders go wrong.
So in this guide, I’ll break down how prop firms work in Australia, what to look out for, and which firms are actually worth considering.
✅ What Is a Prop Trading Firm?
A prop firm gives traders access to capital. You trade their money, and if you make a profit, you get a cut.
Simple on the surface, but the key is how you get funded. Most firms ask you to complete an evaluation or challenge where you prove you can trade profitably without breaking rules on drawdowns, timeframes, and risk.
If you pass, you’re funded. You trade with their money, and if you’re consistent, it can scale from there.
🦘 How Prop Trading Works in Australia
Australia has a strong trading culture, but most prop firms here are offshore. That means they’re not licensed by ASIC, and your trading usually happens on demo environments.
Typically:
- You pay for a challenge or evaluation
- If you pass, you get access to a funded account
- You split profits with the firm (often 50–90% in your favour)
- You trade remotely on your own schedule
It’s a powerful model, but you have to understand the risks and terms.
📊 What Markets Can You Trade?
The best prop firms accessible in Australia offer:
Most use MetaTrader 4/5, cTrader, or Match-Trader. Execution quality and spreads vary and some route to real markets, others don’t.
🪜 How Getting Funded Works
So how do you actually get funded by a prop firm?
1. Choose Your Path
Pick a challenge type and account size. Most offer different tiers (e.g. $10k, $50k, $100k). Some are single-phase, others two-step. Pick what fits your style and risk.
2. Pass the Rules
Hit the profit target (often 8–10%) within a time limit, without exceeding drawdowns. Most traders fail here, not because they’re bad traders, but because they’re trading outside their natural system fit.
3. Get Funded
Prove you can follow the rules and stay consistent, and the firm funds you. You’re trading their capital, usually on a demo tied to live models.
4. Scale Up
Do well and many firms will increase your funding over time – $200k, $400k, more – without risking your own money.
🎯 Getting funded isn’t the goal — staying funded and compounding your edge is.
🏆 Top Prop Trading Firms Accessible in Australia
Here are a few reputable names Aussie traders use now:
| Category | MarketMates | Blueberry Funded | The Concept Trading | FTMO | The 5%ers |
|---|---|---|---|---|---|
| Australian Office | Adelaide | Sydney | Sunshine Coast | Sydney | No |
| 10K Challenge Cost | USD89 | USD90 | USD110 | EUR89 | USD78 |
| Account Sizes | $10K, 25K, 50K, 75K, 100K | $5K, 10K, 25K, 50K, 100K | $5K, 10K, 20K, 50K, 100K | $10K, 25K, 50K, 100K, 200K | $5K, 10K, 20K, 60K, 100K |
| Trading Costs | Retail ($2.50 per lot) | Retail ($3.50 per lot) | Retail ($3.50 per lot) | Retail ($3 per lot) | Retail ($4 per lot) |
| Challenge Type | Balance | Higher of End-Day Equity or Balance | Balance | Equity (includes floating losses) | Equity |
| Trailing Drawdown | No | Some challenges | No | Yes | Yes |
| Consistency Rule | No | No | No | No | Yes |
| Scaling Plan | Yes | Yes | Yes | Yes | Yes |
| Broker Backed | Yes | Yes | Yes | No | No |
| News Trading | Yes | No | Yes | Yes | No |
| Time Limit | No | 30 days of inactivity | No | 30 days of inactivity | 30 days of inactivity |
| Evaluation Model | 1-phase, 2-phase | 1-phase, 2-phase, Instant | 1-phase, 2-phase, Instant | 2-phase | 1-phase, 2-phase, 3-phase |
| Payout Split | 70%-90% | 80% | 50% | 80% | 80% |
| Payout Speed / Terms | Daily | 14 days | Monthly | 14 days | 14 days |
| Markets | FX, Commodities, Indices, Crypto, Shares | FX, Commodities, Indices, Crypto | FX, Commodities, Indices, Crypto | FX, Commodities, Indices, Crypto | FX, Commodities, Indices, Crypto |
| Education | Live + On-demand Workshop | No | No | FTMO Academy | Bootcamp |
Not endorsements, just commonly used by serious traders doing research.
📚 Want to Go Deeper?
If you want more details on how different prop firms stack up check out this guide:
Best prop trading firms – what to look for (and what to avoid)
💡 What Makes a Good Prop Firm?
- Clear, realistic rules – Can you meet the target without crazy risk?
- Fair costs – Are fees and refunds transparent?
- Payout history – Are traders getting paid? (Reddit & Trustpilot are useful.)
- Execution quality – Are trades routed or just internal?
- Community & support – Any coaching or tools?
Too many traders jump in without reading the fine print. Don’t be that person.
⚖️ Balance-based vs Equity-based
One point that is critical for traders selecting a challenge to understand is the difference between Balance-based and Equity-based challenges.
Balance-based:
Your progress is measured only on closed trades. Once you close a trade, your profit or loss is locked in, and that’s all that counts toward your objectives and drawdowns. Open trades don’t affect whether you pass or fail a challenge.
Equity-based:
With an equity-based challenge, your drawdown is measured against the high of the day, including your open profits.
This can be frustrating for traders as a trade that is still in profit can cause a challenge to be lost.
Example:
Imagine you have a 2% daily drawdown, and you have a trade that is 3% in profit. If that trade gives back 2%, then your daily drawdown would be triggered and you would lose the challenge – even though you still have a profitable trade making 1%.
Why Balance-based is Better for Traders
Fairer rules: You’re judged on actual trading results, not random price spikes.
Less stress: No need to worry about equity fluctuations taking you out mid-trade.
Closer to real prop trading: Professional desks track realised P&L, not floating equity.
Better focus: Lets you execute your system without being punished for holding positions.
👉 Bottom line: Balance-based challenges give traders more room to succeed and reflect how real trading should be measured.
⚠️ Common Pitfalls for Aussie Traders
- Overleveraging to meet targets
- Failing daily drawdowns
- Misunderstanding that most accounts are demos
- Chasing bonuses over spreads & execution
- Trying to force a strategy that doesn’t fit
📌 Are Prop Firms Legal in Australia?
Yes, you can legally trade with prop firms from Australia. But:
- Most aren’t ASIC-regulated
- You’re contracting offshore
- No local recourse if something goes wrong
These firms are legit models, but quality varies. Do your homework.
🔍 Final Thoughts: Is Prop Trading Right for You?
Prop trading can be your shot to trade professionally without needing six figures saved up. But don’t treat it like a shortcut.
A prop firm won’t fix your psychology, give you an edge, or teach you discipline — that’s on you.
The traders who succeed treat it like a business. They plan, test, and focus on the next 1,000 trades, not just the next challenge.
If you’re ready for that, prop trading can change the game.
Want to try prop trading?
At MarketMates, we’re a broker and a prop firm, so we do things differently:
- Simple, balance-based challenges that cater for different trading styles.
- Funded accounts that have trades placed on the real market.
- Daily payouts so you don’t have to wait for your rewards.
If that sounds like what you’ve been after, you can learn more here:
Frequently asked questions
Are prop trading firms legal in Australia?
Yes, prop trading firms are legal in Australia. However, many operate offshore and are not regulated by the Australian Securities and Investments Commission (ASIC). This means traders should conduct thorough due diligence before engaging with any firm.
What markets can I trade with Australian prop firms?
Most prop firms accessible to Australian traders offer a variety of markets, including:
Forex
Indices (e.g., AUS200, US500)
Commodities (e.g., gold, oil)
Cryptocurrencies
Stocks (usually as CFDs)
How does the funding process work?
The typical process involves:
Evaluation Phase: Traders must pass a challenge that tests their trading skills and adherence to risk management rules.
Funded Account: Upon successful completion, traders receive access to a funded account to trade the firm’s capital.
Scaling: Consistent performance can lead to increased capital allocation over time.
What are common pitfalls for Australian traders?
Some common mistakes include:
Overleveraging: Taking excessive risks to meet profit targets.
Violating Drawdown Limits: Exceeding daily or overall loss limits.
Misunderstanding Account Types: Confusing demo accounts with live accounts.
Chasing Bonuses: Focusing on promotions rather than trading conditions.
Strategy Misalignment: Using trading strategies that don’t fit the firm’s rules
How should I choose a prop firm?
Consider the following factors:
Clear and Realistic Rules: Ensure you can meet profit targets without undue risk.
Transparent Fee Structure: Understand all costs involved.
Payout History: Research if the firm reliably pays its traders.
Trading Conditions: Assess spreads, execution speed, and platform reliability.
Support and Community: Look for firms that offer guidance and have active trader communities.
Sources
Marketmates uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial guidelines to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
- Van Tharp Institute – Insights on risk management and position sizing.
- CMT Association – Resources on technical analysis and trading strategies.
- Investopedia – Comprehensive explanation of proprietary trading.
- ASIC (Australian Securities and Investments Commission) – Info on financial regulation in Australia.
