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What account size do you need to make $10,000 from forex prop trading accounts?

$10,000 may seem like a lot of cash for a regular trader. For some, it may take a lifetime to get anywhere near this, while others struggle with breaking even. Proprietary companies now offer millions of dollars in cash for the right trader. It would be possible to generate $10,000 from a single trade, provided that you have the right amount in cash and trade responsibly.

By doing some amazing mathematics, we can understand the correct probabilities required to generate $10,000. The total period is set as 20 trading days or one month.

Account size and restrictions

Prop firms offer a ranging account sizes for amateur and professional traders. The amount can vary between $50,000 and $400,000. In general, the monthly gain and drawdown limits stand in the ratio of 1:1. E.g., if the drawdown threshold is 10% of the total account size, then the monthly gain will be 10%.

In terms of pips, a trade with a 10 pip stop loss and 20 pip take profit will constitute a 1:2 risk-reward ratio. A 50 lot position with these stats can earn you $10,000 from a single trade. We won’t consider such big lot sizes as they require million-dollar portfolios with dedicated account managers. In other words, institutional grade liquidity.

For our analysis, we will use 50k, 100k, 200k, and 400k account sizes to generate $10,000 with the drawdown limits stated above.

Profit factor or risk:reward ratio

Win ratio

0.5

70%

1

50%

1.5

40%

2

33.3%

3

25%

The required win rate to break even and the associated risk-reward ratios are shown in the table.

The relationship between profit factor and win rate in forex trading is not always linear. A higher profit factor indicates that the average winning trade is larger than the average losing trade, while a lower profit factor indicates the opposite. However, it is possible to have a high win rate with a low profit factor if the losses on losing trades are small relative to the wins on winning trades.

Risk:reward ratio

Consecutive losses

Required trades to recover

1:1

1

1

1:1

2

2

1:1

3

3

1:2

1

1

1:2

2

1

1:2

3

2

1:5

1

1

1:5

2

1

1:5

3

1

The table shows the number of trades required to recover your account with associated risk: reward ratios.

The relationship between the profit factor and the required trades to break even is inversely proportional. As the profit factor decreases, the number of required trades to break even increases. As mentioned above, it is harder to win with high risk: reward ratio as the take profit is much farther away than the stop loss. By looking at the table you can observe this fact quite easily. For a risk reward ratio of 1:5, you only need to win one trade out of 5 to stay profitable.

50k account

At 50k, you can welcome yourself amongst the big boys. You are managing a load of money and need to keep your emotions under a strict check. This is due to the fact that the big lot sizes will cause a severe change in equity value and your overall balance.

Now let us do the math. How much do you need to make $10,000 on a $50k portfolio? If we talk percentages, it’s 20% of the total account value. With a 1% risk on each trade and risk: reward ratio of 1:1, you’d need to win 20 trades to hit the target. That is after considering the fact that there are no losses in between.

Taking 20 trades can be quite hard, especially if you are a swing trader. A noted measure is to scan multiple instruments for opportunities. However, remember that a single strategy will have a varying win rate over various assets. You can overcome this problem by increasing your risk per trade from 1 to 2% at the expense of the drawdown.

As you increase the risk to 2%, the required number of trades to hit the target reduces to 10. It’ll also take only five trades to hit the max drawdown of 10%.

100k account

As we increase the account value, it becomes easier to generate $10,000. With $100,000 in cash, we’ll need only 10 trades with 1% risk on each to reach our target. Let’s talk some more mathematics here.

Risk: reward ratio can play an important role in keeping the drawdown at bay. With 1:2 value, we only need to win five trades to get to the goal. As our final take profit is further away, it’ll be harder to hit the profit target. The good news is that the required win rate to maintain a breakeven state goes from 50% for a 1:1 to 33% for 1:2 risk-reward ratios.

Riva FX allows you to trade on a 100k account with unlimited retries. Payouts are made biweekly and the profit share is amazing at 70%.

200k account

By now, you may have guessed the number of trades needed to make $10,000 with a 200k portfolio. The value is halved from 100k, i.e., only 5 with 1% risk each trade. Some professional traders lower the risk to 0.5% and achieve their target within ten executions.

Maintaining a lower position size can help support your emotions. For users who get promoted from 100k to 200k portfolios, it is advised to take it slow and increase your lot size gradually.

400k account

 400k is the account value threshold most online prop firms have for a single trader. If you are lucky enough to reach here, congratulations, you only need 2.5 trades with 1% risk on each to get to the $10,000 mark. Confused with the 0.5? The last trade only requires a 0.5% risk, i.e., if your first 2 trades were 10 lots, then the last will be 5 lots.

Use of leverage

Leverage can play an important role in determining the overall lot size you can use. A $20,000 account with a 1:100 margin is typically the same as a $200,000 portfolio with a 1:10 leverage.

Do not forget that adding more leverage to any account will increase the risk. A $10,000 loss on a $20,000 account is a 50% drawdown, while on a $200,000, it stands at 5%.

While most prop firms provide a 1:100 leverage, it is essential not to overstress your account. Breaking any drawdown measures will land you in the 90% of the traders who fail consistently.

Summary

It wouldn’t be wrong to say that trading is a game of numbers and probabilities. A good understanding of the maths can help you generate $10,000 or more with a calculated risk that does not violate the rules of prop firms. Pinpoint your stop loss, take profit and risk percentage before each trade and keep the mindset in check to reach the 400k point. An average trader with a solid mindset can generate $10,000 consistently from an account value of $50,000 or more.

With Riva FX traders can now get funded in a single day. You can use upto 1:50 in total leverage to trade big lots with unlimited retries.