Challenge (Prop Firm)

Detailed Explanation

Prop firm challenges test a trader's ability to generate consistent profits while managing risk. Challenges come in several formats: one-step (single phase with one profit target), two-step (two phases with decreasing profit targets), and three-step evaluations. Key rules include maximum drawdown limits, daily drawdown limits, minimum trading day requirements, and sometimes time limits. Challenge fees typically range from $50 to $1,800 depending on the account size.