Which Prop Firms Allow Options Trading | TradersYard
Understanding Prop Firms and Options Trading
Many traders are on the lookout for opportunities beyond traditional forex and futures trading. If you’re one of those traders interested in options, knowing which prop firms allow options trading can open up new avenues for profit. Options trading provides unique strategies that can amplify returns, but not every prop firm supports this asset class.
What are Prop Firms?
Prop firms, or proprietary trading firms, are companies that provide capital to traders to trade various financial instruments. Traders are often evaluated through challenges to prove their trading skills before being given access to funded accounts. The structures can vary significantly among firms, especially regarding the instruments they allow.
Why Options Trading?
Options trading can be an excellent strategy for traders looking to hedge their positions, speculate on stock movements, or generate income through strategies like covered calls. The ability to trade options allows for greater flexibility and can be a valuable addition to your trading toolkit.
Top Prop Firms That Allow Options Trading
When searching for prop firms that allow options trading, you want to consider several factors, including profit splits, drawdown limits, and trading conditions. Here’s a rundown of some notable firms where you can trade options:
1. TradersYard
TradersYard is a standout option for traders interested in options. They offer evaluation accounts ranging from $10K to $200K, where you can trade options along with forex, commodities, indices, and crypto. Key features include:
- 2-phase challenge: 8% profit target for Phase 1 and 5% for Phase 2.
- 80% profit split from day one.
- Maximum drawdown of 10% total and 5% daily.
- No time limit to complete challenges.
- Payouts in 14 days after the first profit.
This flexibility makes TradersYard an excellent choice for traders interested in options. You can check out their pricing starting from $149 for a $10K account up to $999 for a $200K account.
See pricing here and sign up here.
2. FTMO
FTMO is another reputable firm that allows options trading within their evaluation process. They have a well-structured challenge with a 10% profit target in the first phase and a 5% target in the second phase. FTMO is known for its strong community support and educational resources.
While their profit split is generally 70%, they often run promotions for higher splits, which can be beneficial for traders who are successful in their evaluations.
3. The5ers
The5ers also permit options trading, providing a good balance for traders looking to explore various strategies. They have a unique model that allows you to trade with a funded account after completing their evaluation. Their profit share tends to be around 75%, which is competitive in the market. The5ers focus on longer-term trading, which can benefit options traders who prefer to hold positions for more extended periods.
4. OneUp Trader
OneUp Trader is another option for those interested in options. Their evaluation process is straightforward, with a profit target of 8% for the first phase. They offer a generous profit split of 75% and allow options trading, making them a good choice for traders who want to diversify their strategies.
What to Look for in Prop Firms That Allow Options Trading
When choosing a prop firm for options trading, consider the following:
1. Profit Split
Typically, most funded accounts pay between 70-90% splits. A higher profit split is preferable, but make sure it aligns with the firm’s drawdown limits and trading conditions.
2. Drawdown Limits
Pay attention to the maximum drawdown limits. A 10% total drawdown is standard; however, some firms are stricter, enforcing lower limits. You need to ensure that these limits match your trading style.
3. Evaluation Process
The evaluation process should be fair and attainable. Look for firms with no time limits and reasonable profit targets. This flexibility allows you to trade at your own pace.
4. Trading Conditions
Check the trading conditions such as spreads, commissions, and the available trading platforms. Some prop firms may have better conditions than others, which can impact your trading performance.
Common Myths About Options Trading in Prop Firms
There are several misconceptions surrounding options trading within prop firms. Here are a few you should be aware of:
1. Options Trading is Too Risky
While options trading does involve risk, it can also be a method to manage risk. Many traders use options to hedge against losses in their primary investments.
2. You Need Significant Capital
Many prop firms allow you to trade options with less capital than you might think. Firms like TradersYard offer accounts starting at $10K, making it accessible for more traders.
3. You Can’t Trade Options and Forex Together
Many firms, including TradersYard, allow for a diverse trading portfolio. You can trade options, forex, commodities, and more within the same account.
Conclusion
Finding the right prop firm that allows options trading can significantly impact your trading journey. TradersYard stands out as a solid option due to its flexible structure, high profit splits, and supportive trading environment. If you’re ready to take your options trading to the next level, check out their offerings.
Frequently Asked Questions
Q: Can I trade options with TradersYard?
Yes, TradersYard allows options trading along with other asset classes like forex and commodities.
Q: What is the maximum drawdown allowed at TradersYard?
The maximum drawdown at TradersYard is 10% total and 5% daily, which is quite reasonable for options trading.
Q: How quickly can I get paid after making a profit?
TradersYard processes payouts within 14 days after your first profit, which is a quick turnaround compared to many firms.
Q: Is there a time limit for completing the evaluation at TradersYard?
No, there is no time limit to complete the challenges at TradersYard, allowing you to trade at your pace.
