Prop firm accounts, short for proprietary trading firm accounts, are accounts provided by companies that fund traders with their own capital, allowing traders to trade with larger amounts of money than they would typically have on their own. For beginner traders, this can be an appealing option because the firm absorbs the risk, meaning traders don’t have to put up all their own money. Instead, traders usually pay a fee to take an evaluation test, where they demonstrate their trading skills under specific rules, such as risk limits and profit targets. Once they pass, they are given access to the firm's funds. In return, profits made by the trader are typically split between the trader and the firm, often with the trader receiving a percentage. This setup allows traders to scale their trading and potentially earn more, while the firm benefits from successful traders without taking on the trading themselves.

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