I once chose a prop firm the way most traders do: I looked at the account size, looked at the profit target, and picked the bigger numbers. The account was $200,000 and the target looked easy. What I never did was put the two firms I was choosing between side by side, in dollars. Three weeks later I breached a daily limit that looked generous on paper but left me almost no room once my real costs were taken out. The firm was not scamming me. My comparison was.
In this article
That is why I built the Prop Firm Rule Comparison Calculator at the top of this page. Enter two firms’ rules and it shows the dollar truth for both: the daily limit, the effective room after costs, the overall floor, the target in dollars and the target-to-cushion ratio. Here is what each number means and why I compare them this way.
The five numbers that decide how a firm actually feels
Rulebooks are written in percentages. Trading happens in dollars. A 5% daily limit on $100,000 is $5,000 of room. The same 5% on a $25,000 account is $1,250, and if your daily costs run $45, you have already given away a much bigger slice of your day on the smaller account.
Effective room is the number I care about most: your daily limit minus the costs you pay just for showing up — spreads, commissions, the occasional swap. The calculator shows it for both firms so the gap is visible.
The target-to-cushion ratio answers a different question: how many daily limits does the target cost? A $10,000 target against a $5,000 daily limit is a 2.0x ratio. It tells me I need roughly two full daily limits of profit — which means the challenge is really asking me to win, in total, about twice what I am allowed to lose in one day. Read the general rules behind this in prop firm max daily drawdown explained.
The maths behind the comparison
Every output is one small formula. Nothing fancy, but writing them down stops the percentage illusion.
| Variable | What it is | Typical value |
|---|---|---|
| Account Size | The starting balance of the challenge or funded account | $25,000 – $200,000 |
| Daily Loss % | The firm’s per-day loss ceiling | 3% – 5% |
| Overall Drawdown % | The total loss ceiling, static or trailing | 6% – 12% |
| Daily Trading Costs | Your spreads, commissions and swaps on a normal day | $20 – $200 |
| Profit Target % | What you must make to pass or scale | 6% – 10% |
For trailing drawdown there is no fixed floor, because the limit follows your highest equity. The calculator shows the buffer in dollars instead — a trailing 8% on $100,000 means the floor sits $8,000 below your peak, which is brutal if your peak was only $3,000 of profit.
Firm A against Firm B, in real dollars
Here is the default comparison the calculator ships with. Firm A is a $100,000 account at 5% daily and 10% overall with a 10% target. Firm B is a $50,000 account at 4% daily and 8% overall with an 8% target. On percentages they look close. In dollars they do not.
| Metric | Firm A | Firm B |
|---|---|---|
| Daily limit | $5,000.00 | $2,000.00 |
| Effective room after costs | $4,955.00 | $1,970.00 |
| Overall floor (static) | $90,000.00 | $46,000.00 |
| Profit target in dollars | $10,000.00 | $4,000.00 |
| Target-to-cushion ratio | 2.0x | 2.0x |
Both firms ask for exactly twice the daily limit, so the challenges are equally demanding per dollar of room — but Firm A gives you two and a half times more room to work with. That is the verdict the calculator reaches. Bigger room is what matters, because your costs and losing streaks are measured in dollars, not in firm marketing.
Using the comparison calculator step by step
Enter both firms’ rules, then press Compare. Each pair of fields covers Firm A and Firm B.
| Input field | What to enter | Sample figure |
|---|---|---|
| Account size ($) — both firms | Starting balance of each account | 100000 / 50000 |
| Daily loss limit (%) — both firms | The firm’s per-day ceiling | 5 / 4 |
| Daily base — both firms | Whether the limit is set from the initial balance or start-of-day equity | initial / initial |
| Overall drawdown (%) — both firms | The total loss ceiling | 10 / 8 |
| Overall type — both firms | Static or trailing drawdown | static / static |
| Profit target (%) — both firms | What you must make to pass | 10 / 8 |
| Est. daily trading costs ($) — both firms | Your normal spread + commission + swap per day | 45 / 30 |
Everything is calculated in your browser, and nothing is stored.
What the numbers cannot tell you
The calculator is honest about what it knows, so let me be honest about what it does not. A start-of-day base matches an initial-balance base on day one, but it can shrink your room after a winning day. Trailing drawdown punishes peak-and-give-back swings, and news spikes can gap through stops. None of that fits in a percentage box.
My personal rule, learned the expensive way: I want the friendlier firm to win by a clear margin on effective room. If the verdict is “roughly equal”, I choose the simpler rulebook — fewer ways to be disqualified by accident. Then I set my personal daily stop below the firm limit, because the firm’s limit is where I die and mine is where I stop.
Two companions help after this one: the Floating Loss Drawdown Calculator shows how open trades eat the room you just compared, and the Challenge Pass Time Calculator tells you how long the target will actually take. For real-world rule wording, see the FTMO trading rules page.
Questions traders ask when comparing prop firms
Which matters more, account size or daily loss limit?
The daily limit, in dollars. Account size is vanity; the daily limit is what decides whether a normal losing day kills you. I multiply account by the daily percentage and compare that number first, then subtract my costs to get the effective room.
What is a good target-to-cushion ratio?
Lower is easier. Most challenges sit around 1.6x to 2.0x — you must make about twice what you may lose in a day. Anything above 2.5x starts to feel like the firm wants a hot streak, and anything near 1.5x is genuinely kind.
Should I really subtract trading costs from the daily limit?
Yes, because the firm does not subtract them for you. Costs come out of the same equity the limit measures. On a small account with wide spreads, costs can quietly eat a quarter of your day before you have placed a trade.
How do static and trailing drawdown change the comparison?
A static floor is a fixed number you can plan around. A trailing floor follows your peak equity, so banking $4,000 of profit and giving it back can breach you even though you are “flat”. I treat trailing as strictly harder and want meaningfully better room to accept it.
