Prop trading, short for proprietary trading, originally meant a firm trading its own capital for its own profit, employing traders on a desk and paying them a share of what they made. The retail products sold under that name today are a different business, and understanding the difference is the most useful thing you can know before paying for one.
The institutional meaning, which came first
On an institutional desk the firm's own money is at risk, the trader is an employee or a contractor, and the firm's profit comes from trading. Selection is expensive, so firms are highly selective, and there is no fee for being considered. The trader's share is negotiated rather than published, and the capital being traded is real capital in real markets carrying real firm risk. Nearly every association the phrase carries, including its prestige, comes from this version.
The retail meaning, which is what is being sold
The retail model inverts the economics. You pay a fee to be evaluated, the account is simulated, and the firm's revenue comes substantially from evaluation and reset fees rather than only from trading profits. There is no employment, no negotiation and no selection cost to the firm, because the fee covers it. None of that makes the product illegitimate, and the firms in this index publish their terms plainly; it does mean that a comparison should be about fees and rules, which is what this site records.
Why the distinction changes what you compare
If the firm makes money when you fail, the rules are not incidental to the product, they are the product. That is why this site puts the drawdown rule ahead of the profit split: the split is 90% at every firm here that publishes one, while the loss limit differs enough that two firms with identical headlines are different businesses to trade. Read the rule that ends the account first, and treat the split as a formality the market has already settled.
Questions people ask about what is prop trading
Is retail prop trading the same as working at a prop firm?
No. The retail products in this index are paid evaluations on simulated accounts, not employment. Nobody here is hired, and the capital is simulated throughout.
Do prop firms make money when traders fail?
Evaluation and reset fees are a revenue line at these firms, and firms publish their pricing openly. This site does not publish pass rates or any claim about how the revenue splits, because the industry's published figures do not support one and we could not verify it.
Is prop trading worth it?
That is not a question this site answers. It publishes what each firm charges and what rules it imposes, so the arithmetic is yours to do, and it publishes no earnings projection or performance claim of any kind.