In the bustling world of proprietary trading, finding the right firm to back your trading ambitions can be a daunting task. One name that frequently pops up in conversations among traders, especially those looking to break into futures trading, is Topstep. But how does it stack up against the competition? Let’s dive deep into Topstep’s offerings, compare it with other notable prop trading firms, and give it a score based on what really matters.
What is Topstep?
Topstep is a proprietary trading firm that offers aspiring traders the opportunity to trade with the firm’s capital once they’ve proven their skills through a simulated trading evaluation process. Founded in 2012 by Michael Patak, Topstep has become one of the most well-known platforms in the industry, especially for futures traders.
The firm’s core offering is its Trading Combine, a two-step evaluation process that tests traders’ ability to manage risk and generate consistent returns. Successful traders get funded by Topstep and share a percentage of the profits they make.
How Does Topstep Work?
Topstep’s Trading Combine is the gateway to getting funded. Here’s how it works:
- Step 1: Profitability and Risk Management
- Traders start in a simulated environment with a set account balance and trading rules.
- The goal is to hit a profit target while adhering to risk management rules, such as daily loss limits and maximum drawdowns.
- Step 2: Consistency
- In this stage, traders must demonstrate consistency in their trading by hitting smaller profit targets and continuing to follow strict risk management guidelines.
Pass these two steps, and you’re on your way to trading with Topstep’s capital.
How Does Topstep Compare with Other Prop Firms?
When evaluating Topstep, it’s essential to compare it with other popular prop trading firms to understand where it excels and where it might fall short.
1. FTMO
- Market Focus: Forex, Indices, Commodities, Cryptos.
- Evaluation: Two-step process similar to Topstep, but with a focus on forex and other markets instead of futures.
- Funding: Up to $400,000 for successful traders.
- Profit Split: 80-90% to the trader.
- Unique Selling Point: FTMO’s trading conditions are relatively flexible, and their focus on forex attracts a broader range of traders.
Comparison: FTMO offers a higher funding cap and a better profit split than Topstep, making it a preferred choice for traders looking to trade markets beyond futures. However, Topstep’s deep expertise in futures markets makes it a go-to for traders focused on that niche.
2. Earn2Trade
- Market Focus: Futures.
- Evaluation: The Gauntlet Mini (one-step evaluation) and The Gauntlet (two-step evaluation).
- Funding: Up to $200,000.
- Profit Split: 80% to the trader.
- Unique Selling Point: Earn2Trade offers extensive educational resources, making it appealing to newer traders.
Comparison: Earn2Trade’s one-step evaluation (Gauntlet Mini) is a faster route to funding compared to Topstep’s two-step process. However, Topstep’s longer track record and more rigorous evaluation might appeal to traders seeking a challenge that better simulates real trading conditions.
3. OneUp Trader
- Market Focus: Futures.
- Evaluation: Single-step process, emphasizing simplicity.
- Funding: Up to $250,000.
- Profit Split: 80% to the trader.
- Unique Selling Point: A straightforward evaluation process with fewer rules and restrictions.
Comparison: OneUp Trader offers a simpler and quicker path to funding with a similar profit split to Topstep. However, Topstep’s comprehensive evaluation might better prepare traders for the real-world pressures of managing a funded account.
What We Love About Topstep
- Niche Focus on Futures: While many prop firms cater to a wide range of markets, Topstep’s dedicated focus on futures trading is a massive plus for those who specialize in this area.
- Rigorous Evaluation Process: Topstep’s two-step evaluation is more than just a hoop to jump through—it genuinely prepares traders for the realities of managing a funded account, emphasizing both profitability and consistency.
- Strong Community and Support: Topstep has built a vibrant community of traders, and their support team is highly responsive. They offer various resources, including daily market recaps and webinars, which are invaluable for ongoing trader development.
- Risk Management: Topstep’s emphasis on risk management cannot be overstated. The firm’s rules push traders to develop disciplined habits that are essential for long-term success.
Areas Where Topstep Could Improve
- Profit Split: At 80%, Topstep’s profit split is solid but not industry-leading. Some competitors offer up to 90%, which can make a significant difference over time.
- Evaluation Costs: The cost of entering the Trading Combine can add up, especially for traders who need multiple attempts to pass. While Topstep frequently runs promotions and discounts, the cost is still something to consider.
- Limited Market Options: Topstep’s focus on futures is a double-edged sword. While it’s great for futures traders, those interested in forex or crypto might find other platforms more suitable.
The Verdict: How Does Topstep Score?
When it comes to futures trading, Topstep is hard to beat. The platform’s rigorous evaluation process, combined with its strong community support and educational resources, makes it an excellent choice for traders who want to focus on futures.
However, for traders looking for higher profit splits, more flexible evaluations, or access to a broader range of markets, firms like FTMO or OneUp Trader might be worth considering.
Final Score: 8.5/10
- Evaluation Process: 9/10
- Funding Potential: 8/10
- Profit Split: 7.5/10
- Market Access: 7/10 (futures focus)
- Community & Support: 9/10
Topstep’s score reflects its strengths in futures trading and its areas for improvement, particularly in profit splits and market variety. For dedicated futures traders, Topstep remains a top choice, but it’s worth exploring other options if you’re trading in different markets.
Whether you’re a seasoned futures trader or just starting out, Topstep offers a platform that can help you grow your skills and, ultimately, your trading account. Just make sure it aligns with your trading goals and style before diving in.
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