Profit splits are one of the most talked-about — and misunderstood — aspects of proprietary trading. To many aspiring funded traders, the idea of keeping 80%, 90%, or even 100% of the profits from trading someone else’s money sounds like a dream come true. But beneath the surface, profit splits are more complex than they appear. They can vary based on firm structure, funding model, and even fine-print rules that many traders overlook.
Understanding how profit splits actually work is essential if you’re planning to work with a prop firm. Not all profit splits are created equal, and the highest number doesn’t always mean the best deal. In fact, some “high split” offers come with hidden costs, restrictive rules, or payout delays that make them less favorable than they seem at first glance.
Let’s take a deep dive into what profit splits are, how they work, and what you should really be looking for when evaluating whether you’re getting a fair deal as a funded trader.
What Is a Profit Split in Prop Trading?
In simple terms, a profit split is the portion of trading profits a funded trader keeps after successfully generating returns on a proprietary trading account. Since the firm is providing the capital, technology, and risk oversight, they take a portion of the profits in exchange for giving you the opportunity.
Here’s a basic example:
- You generate $10,000 in profit during a payout period
- Your profit split is 80%
- You keep $8,000, and the firm keeps $2,000
This structure is designed to reward skilled traders while protecting the firm’s capital base. It also allows firms to reinvest profits, pay operating costs, and continue offering funding to new traders.
Common Profit Split Tiers in 2025
While every firm sets its own rules, the most common profit split tiers offered by reputable prop firms in 2025 include:
- 70/30 Split – The baseline offer at many firms.
- 80/20 Split – Common for funded traders after their first payout.
- 90/10 Split – Often reserved for high performers or available through scaling plans.
- 100% First Month – Some firms now offer 100% of your first payout to attract new traders.
But the numbers alone don’t tell the whole story. You need to understand how and when profits are calculated, whether there are fees or taxes deducted before your share is paid out, and how consistently the firm pays.
Instant Funding vs Evaluation Models: Who Offers More?
Firms that offer instant funding or “Express” accounts tend to provide lower profit splits, often between 60–75%. This is because there’s more upfront risk to the firm — they’re allowing you to trade right away without proving yourself in a challenge. In this case, the firm wants to offset risk by taking a larger share of profits.
On the other hand, firms using the challenge model often reward you with a higher profit split if you successfully complete the evaluation process. These firms typically offer splits starting at 80%, with many going up to 90% or more as you scale your account or hit milestones.
So while 75% might sound low compared to 90%, if you didn’t have to pay a challenge fee or go through a verification process, that lower split might be part of a fair exchange.
Hidden Costs That Affect Your Real Profit
Sometimes, the advertised profit split doesn’t tell the whole story. Here are hidden factors that can eat into your earnings:
1. Withdrawal Minimums
Some firms require a minimum profit amount (e.g., $1,000) before you can request a payout. If your trading is consistent but modest, you may not reach that threshold quickly.
2. Monthly Platform Fees
Even after becoming funded, you might still be responsible for monthly platform or data feed fees, especially with firms that offer futures or equities trading.
3. Profit Reset Rules
Some firms “reset” your account balance after a payout, meaning you start from the original balance — not your new high watermark. This can impact your psychological edge and future drawdown calculations.
4. Scaling Profit Conditions
Scaling plans that promise higher funding or profit splits often require you to hit specific performance benchmarks — sometimes with stricter risk parameters than your initial funding. Failing to meet those can delay or prevent increases.
High Split ≠ Best Deal: The Context Matters
Just because a firm advertises a 90% or 95% profit split doesn’t automatically make it the best choice. What matters more is how and when you get paid — and whether the firm actually honors the split in a transparent, timely manner.
Let’s compare two hypothetical firms:
- Firm A offers an 80/20 split, pays every two weeks, allows withdrawals after 5 trading days, and has no platform fees.
- Firm B advertises a 90/10 split but requires 30 days of trading, has strict holding time rules, and delays withdrawals by 15 days after your request.
In real-world terms, Firm A might actually pay you more money, more often — and with fewer restrictions.
Do Firms Actually Pay Out?
This is one of the most important questions to ask before you join a prop firm. A high profit split is meaningless if the firm doesn’t consistently pay its traders on time. Here’s what to look for:
- Verified Payout Proofs – Many firms now post payouts publicly (often on social media or Discord). Look for transparency.
- Trader Testimonials – What are real traders saying about their payout experiences? Look on Trustpilot, Reddit, or Discord groups.
- Payout Schedule – Some firms pay weekly, others bi-weekly, and some monthly. Know what you’re signing up for.
- Withdrawal Methods – Can you receive payments via crypto, wire, or PayPal? Are there currency conversion or withdrawal fees?
A firm with a lower profit split but consistent, smooth payouts can offer more value than a firm promising sky-high splits but holding onto your profits or complicating the process.
Profit Splits & Scaling Plans
One of the most exciting features of modern prop firms is the scaling plan — where traders who meet certain criteria over time can unlock:
- Higher capital allocations
- Higher profit splits
- Longer trading windows
- Lower fees
Scaling plans are typically offered to traders who maintain profitability and stay within risk rules for 2 to 6 months. Some firms will increase your account size up to $1,000,000 or more over time. Others will boost your split from 80% to 90% or beyond once you hit certain payout milestones.
When evaluating a firm’s split, check if there’s a clear, fair path to scaling. Firms that reward loyalty and performance tend to attract more serious traders.
Red Flags to Watch For
Here are some warning signs that a “high profit split” might be too good to be true:
- Unrealistic Challenge Rules: If a firm advertises a 95% profit split but makes the evaluation nearly impossible to pass, it may be more of a marketing gimmick.
- Unclear Payout Process: If a firm doesn’t publish when and how they pay, or fails to respond to payout questions, be cautious.
- Inconsistent Terms: Some firms change their rules mid-challenge or mid-month — a sign of poor management or cash flow issues.
- Lack of Track Record: New firms offering 90–100% splits without any trader testimonials may be too risky to trust early on.
Always read the fine print and know exactly what you’re agreeing to — before you buy a challenge or commit to a firm.
How to Maximize Your Profit Split Value
Regardless of the firm, here are tips to ensure you’re getting the most from your profit split:
- Choose the Right Firm for Your Strategy: Scalpers and swing traders often have very different needs. Pick a firm whose rules don’t limit your edge.
- Track Your Metrics: Use tools to monitor your drawdowns, profit factor, win rate, and risk per trade. Consistency pays.
- Stay Within Rules: Nothing kills your profit split faster than breaking rules. Even one mistake can lead to account termination.
- Take Advantage of Scaling: Hit your milestones and grow both your account and your share of the profits.
- Diversify Firms if Needed: Many top traders manage multiple funded accounts across different firms to diversify risk and income.
Profit splits are at the core of the prop trading relationship — and understanding them fully is key to long-term success. While a high split is attractive, it’s not the only factor that determines whether you’re getting a fair deal. Speed, support, payout consistency, and realistic rules often matter even more.
In the end, the best profit split is the one that allows you to grow sustainably, trade freely within your strategy, and build long-term income in a transparent, professional environment. With dozens of firms offering slightly different models, the most successful traders focus on fit — not flash.