The minimum amount of profit a trader must earn to pass an evaluation phase or qualify for a payout. Profit targets are expressed as a percentage of the starting account balance or as a fixed dollar amount.
Why It Matters
- 1The profit target is the primary goal of every evaluation.
- 2It determines how aggressively you need to trade and directly influences your risk management strategy.
- 3A 10% profit target on a $100,000 account requires $10,000 in gains, which is very different from a 6% target requiring $6,000. Lower profit targets generally mean you can trade more conservatively to reach them, especially when combined with a time limit that requires steady daily progress.
Example
You purchase a $100,000 two-step evaluation with an 8% Phase 1 profit target ($8,000) and a 5% Phase 2 profit target ($5,000). You need to earn $8,000 without violating any drawdown rules to advance to Phase 2. Once in Phase 2, you need another $5,000 in profit to receive your funded account.
Common Mistakes
- ✖Rushing to hit the profit target and taking oversized positions that violate drawdown rules
- ✖Not factoring in commissions and fees which reduce net profit toward the target
- ✖Assuming the profit target is the same across all evaluation phases — Phase 2 targets are usually lower