For many, insufficient capital is a major barrier to their journey to business, as it is often stopped before it begins. This obstacle has led to the rise of proprietary (prop) trading, providing underfunded traders with the leverage they need to execute their trading strategies and potentially turn a profit. As prop trading grows in popularity, companies are expanding their services to stay ahead of the curve by offering traders a variety of financing options.
These include challenges that offer unlimited time periods, free trial options and an expanded selection of financial assets to trade. Among these innovative offerings, the support business scaling plans have become particularly attractive.
But what is scaling plans and why is Topstep Scaling Plan getting so much attention? Let’s dive deeper to understand the benefits and why it can be an outstanding choice for traders who want to expand their trading career.
Purpose and Benefits of the Scaling Plan
The Scaling Plan aims to gradually introduce traders to the live market environment, encouraging steady equity growth while minimizing unnecessary risks. Since its implementation, it has significantly improved trader longevity.
- Initial Scaling: Traders must scale their trading activities initially to survive any early drawdowns and to enhance their chances of long-term success in the Express Funded Account.
- Live Funded Account Adjustments: When cumulative profits exceed $10,000, traders can request adjusted risk parameters in their Live Funded Account.
Importance of the Scaling Plan
- Guidance on Account Leverage: The Scaling Plan serves as a guideline for responsibly leveraging a growing account.
- Mitigating Over-Leverage Risks: Over-leveraging is a major threat to long-term trading success. The Scaling Plan helps mitigate this risk.
Trading Parameters
The Scaling Plan specifies the maximum number of contracts you can trade, based on your account balance. You are not required to trade the maximum number of contracts; for example, if your account allows three contracts, you can choose to trade only two.
The maximum number of contracts does not increase during the trading day, even if your earnings meet or exceed the threshold to scale up. The next level of the Scaling Plan can only be accessed in the following session. To ensure you are trading within your limits, check your Trade Report daily after it updates at 5 PM CT.
Topstep Scaling Plan Policy
The Scaling Plan is a key feature of the Express Funded Account, designed to help traders manage their risk as they transition into live trading. This plan is evaluated daily when your Trade Report is updated. Although it was previously part of Step 2 in the Trading Combine Program, it now functions independently within the Express Funded Account.
As traders build or lose equity, their buying power adjusts accordingly based on their end-of-day profit and loss (P&L). This dynamic is illustrated in the provided table which show how account balance correlates with the maximum allowable position size.
Topstep Special Considerations
- Micros vs. Full-Sized Lots: In the Trading Combine, Express Funded Account, and Live Funded Account, micros are treated as full-sized lots. For instance, one lot in ES (E-mini S&P 500) equals one lot in MES (Micro E-mini S&P 500) concerning the maximum position size.
- TopstepX Platform: The calculation for micros and minis differs on the TopstepX platform. For detailed information, refer to the specific platform guidelines.
Platform Enforcement
- Platform Limits: Some platforms, such as Tradovate, NinjaTrader, and Rithmic-based platforms, attempt to prevent orders that exceed your current lot limit under the Scaling Plan. However, this prevention is not guaranteed.
- Daily Confirmation: Confirm your current Scaling Plan limits daily on your dashboard.
- T4 Platform Limitations: The T4 platform cannot prevent orders that exceed the Scaling Plan due to technical limitations. It is advisable to enable order confirmations and closely monitor your open lots when using T4.
Error Handling
If you accidentally exceed the allowed number of contracts but correct the mistake within 10 seconds, it will not count as a rule violation. Errors left uncorrected for longer than 10 seconds may result in account review. Always monitor your net position size to ensure compliance.
Tips to Avoid Exceeding the Scaling Plan
- Workspace Setup: Arrange your trading platform workspace to display open positions and orders clearly.
- Order Confirmations: Enable the Order Confirmation setting on your trading platform. This feature requires you to reconfirm an order before it is submitted, reducing the risk of accidental trades.
Here is the most important information you should know about the Scaling Plan:
- Traders are not required to trade the maximum number of contracts; For example, if your account balance allows for 3 contracts, you can choose to trade only 2 contracts at a time.
- The contract limit according to the scaling plan remains unchanged during the trading day. Traders must wait until the next trading session to switch to a higher contract limit under the Scaling Plan, even if their income reaches the amount required to scale on the same day.
- It is recommended that you check your trading report daily after it is updated at 5:00 PM CT. This check helps determine the number of contracts to trade in your account during the next session and ensures compliance with the rules of the scaling plan.
Topstep Futures Prop Firms Competitor Scaling Plan Breakdown
When it comes to scaling plans for your business floor, Topstep stands out with its well-structured approach. Let’s see how it compares to its competitor in the futures prop firm market.
Earn2Trade Ladder Scaling Plan
Earn2Trade offers a ladder in its funded trader programs by regulating the number of futures contracts a trader can enter based on their profit. In comparison, Topstep Prop Firm offers a more comprehensive, simple and incremental business association that emphasizes consistent risk management and strategic growth.
Earn2Trade may allow multiple contracts to be traded after a certain level of profit, but Topstep lacks the valuation depth and growth potential during the trader’s journey.
Funding and Scaling in The Trader Career Path
One of the key features of The Trader Career Path® (TCP) is the inclusion of a scaling plan for candidates who pass the evaluation. This plan ensures that as funded traders withdraw sufficient profits from their trading accounts, the proprietary trading firm will upgrade their accounts with additional capital.
- TCP25 Scaling: Traders funded through the TCP25 program can scale their accounts up to $200,000.
- TCP50 Scaling: Traders funded through the TCP50 program can scale their accounts up to $400,000.
Additionally, traders who reach the profit target on the $200,000 account after participating in the TCP25, or on the $400,000 account after participating in the TCP50, will receive a custom offer from the proprietary trading firm, potentially providing even greater opportunities for growth and success.
The Trading Pit Scaling Plan
Each Challenge is linked to its own Scaling Plan. After you pass one of The Trading Pit Futures Challenges, you will be given a Profit Target and Drawdown along with your new demo account. Once you reach a Profit Target, you will receive a payout and access to a next-level demo account with more capital and more flexible drawdown limits.
After you pass one of The Trading Pit Futures Challenges, you will receive a Profit share of up to 80% (90% for Topstep) depending on how far you can climb through our Scaling Plan.
MyFundedFutures Scaling Plan
Here on MFFU scaling plan table you can see that it is a very similar plan of Topstep:
Purdia Capital
Purdia Capital offer less contract flexibility than Topstep on his scaling plan, for every additional $1,000 maintained in a trader’s Live Funded Account, the trader becomes eligible to trade one more full-size contract (such as ES, NQ, GC) or ten micro contracts (such as MES, MNQ, MGC). It is crucial to maintain this increased balance to support trading larger position sizes. If the balance falls due to withdrawals or losses, the maximum position size will decrease accordingly.
Traders can request increases to their maximum position size limits and other risk parameters once per week by contacting their assigned risk manager. However, any changes to risk parameters are at the sole discretion of Purdia Capital. The firm reserves the right to limit increases in risk parameters to protect its capital.
Conclusion
Topstep takes the lead with its proven track record and well-crafted scaling plan that promotes responsible business growth. Unlike its competitors, Topstep ensures that traders are well prepared to handle the increased capacity by emphasizing discipline and risk awareness.
Topstep’s methodical and educational approach ensures the longevity and sustainability of an entrepreneur’s career, helping them achieve long-term success. If you appreciate a platform that not only challenges your trading prowess, but also guides you to disciplined and profitable trading. Topstep stands out with its Topstep Scaling Plan, which offers a systematic journey to trading real funds.
The Scaling Plan is a distinctive feature that provides traders with a gradual way to increase their trading capital based on performance and risk management requirements.
This approach encourages continuous improvement, supported by Topstep’s training resources and training.
Additionally, Topstep creates a community where traders can share knowledge and add value to the learning process. The company’s clear guidelines and disclosure of risks ensure an open business environment for all parties. In short, with Topstep’s structured scaling plan and comprehensive support system, Topstep is an excellent choice for traders who want to build a sustainable career in the market.
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