The agreed-upon ratio that determines how trading profits are divided between the prop firm and the funded trader. Common splits include 80/20, 75/25, and 90/10, where the first number represents the trader's share.
Why It Matters
- 1The profit split directly determines your take-home income from funded trading.
- 2A higher split means more money in your pocket, but firms offering higher splits may compensate with stricter rules, higher fees, or lower account sizes.
- 3Understanding how the split works — and when it applies — is essential for calculating your actual earnings.
Example
- 1You earn ,000 in trading profits on your funded account.
- 2With an 80/20 profit split, you receive ,000 and the firm keeps ,000. Some firms offer scaling programs where your split improves to 90/10 after reaching certain milestones.
Common Mistakes
- ✖Assuming the advertised split applies from the first payout — some firms start lower and scale up
- ✖Not factoring in fees that reduce your effective profit split
- ✖Comparing splits without considering other rule differences between firms