Prop Firm Rules Explained: Everything You Need to Know in 2026
Prop Firm Rules Explained
Understanding prop firm rules is critical to passing evaluations and staying funded. Here's a complete breakdown of every rule type.
Core Rules Every Prop Firm Has
1. Daily Loss Limit
The maximum amount you can lose in a single trading day. Typically 5% of your account balance. If you hit this limit, you cannot trade for the rest of the day.
Alpha Trader Firm: 5% daily loss limit. One of the most reasonable in the industry.
2. Maximum Drawdown
The maximum total loss allowed from your highest account value. Typically 10% of the starting balance.
Alpha Trader Firm: 10% maximum drawdown. Calculated from the initial balance, not the peak.
3. Profit Target
The profit percentage you must reach to pass each phase of the evaluation.
Alpha Trader Firm Phase 1: 8% profit target
Alpha Trader Firm Phase 2: 5% profit target
4. Minimum Trading Days
Some firms require a minimum number of trading days. Alpha Trader Firm has no minimum trading days — you can pass the evaluation in any timeframe.
Rules That Vary by Firm
| Rule | Alpha Trader Firm | FTMO | Topstep |
|---|---|---|---|
| News Trading | ✅ Allowed | ❌ Restricted | ❌ Restricted |
| Weekend Holding | ✅ Allowed | ❌ Not Allowed | ❌ Not Allowed |
| EA/Bots | ✅ Allowed | ⚠️ Limited | ❌ Not Allowed |
| Hedging | ✅ Allowed | ⚠️ Limited | ❌ Not Allowed |
| Copy Trading | ⚠️ Limited | ❌ Not Allowed | ❌ Not Allowed |
Why Alpha Trader Firm's Rules Are Trader-Friendly
Alpha Trader Firm's rules are designed to mirror real-world trading conditions rather than create artificial restrictions. News trading and weekend holding are allowed because professional traders use these strategies.
Trade with the most trader-friendly rules — Alpha Trader Firm →