How to Pass Prop Firm Challenges with Andrew Mitchem & Etienne Crete



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#596: How to Pass Prop Firm Challenges with Andrew Mitchem & Etienne Crete

In this video:

00:05 – Passing a prop firm challenge.

00:19 – Talking prop firm challenges with Etienne Crete.

00:45 – Horror stories from traders starting a prop firm too early.   

02:08 – How to start trading on a prop firm account.

03:13 – How to pick a prop firm.

06:10 – How much should you risk per trade.

08:10 – Treat a demo, a live and a prop firm account the same.

10:25 – Have a proven strategy first before getting on a prop firm account.

15:28 – Does the prop firm have the markets you trade available?

17:15 – How to find us and how to join us at The Forex Trading Coach

Passing a prop firm challenge.

Andrew Mitchem

If you’re on a $10,000 prop firm, you know, you you’re risking quite tiny amounts, but that’s fine, you know? But just go very, very small because just don’t get stopped out and you’ll eventually, you know, if you’re trading good enough, you’ll eventually get to that profit target.

Talking prop firm challenges with Etienne Crete.

Etienne Crete

Sitting down today with Andrew Mitchem. we want to do an episode specifically about prop firms and what it takes to become a funded trader, but also kind of scale things up. And you get to the next level of performance to scale it up to, we can make more money trading with more capital. So Andrew welcome back on the podcast. Continue here.

Etienne Crete

Let’s start with this. I actually get people who reach out to you and kind of ask you about prop firms and how they should go about it. What’s your first train of thought into what is the right time to go for prop firm?

Horror stories from traders starting a prop firm too early.   

Andrew Mitchem

Okay, I find that so many people tell me stories. In that kind of horror stories, they jump in too quick. And I think people aren’t doing it realistically. They jump in because they see it as maybe I don’t have enough money myself. And it’s a it’s a good way of potentially earning funds and, and commissions, etc., but they don’t have any, background into trading properly themselves.

Andrew Mitchem

You know, they don’t have a strategy, the confident in them. And they have proven themselves first. And I think that’s the pitfall that too many people jump into.

Etienne Crete

Definitely like trying to get capital before you are profitable trader.

Andrew Mitchem

Yeah. I mean, I just tell people maybe you look at it and, you know, 6 to 12 months time, be real about this. Yes, look prop firm can be absolutely fantastic once you know what you’re doing. But spend some time upfront to learn the process of trading. Forget how much money you make. Don’t even look at money.

Andrew Mitchem

Just understand the process of trading. You know, low risk, etc., low drawdowns, because ultimately that’s the thing. It’s going to get you through a pot firm. And if you don’t understand that hitting that drawdown criteria is what’s going to make you lose your money.

Etienne Crete

How do you someone interested in the process? Because a lot of people are going to, of course, focus on the outcome, trying to get the result, how do you get them to, first of all, follow the process? But they kind of have to be interested in then involved in it too.

Andrew Mitchem

How to start trading on a prop firm account.

Andrew Mitchem

Yeah, it’s a tricky one because everybody wants the results and everybody wants the money. I suppose all I can do is probably a little bit like is keep going on and on and on with the same story, because ultimately that’s the best way you’re going to get a result. You know, you almost got beaten into people was like, please don’t waste your time away or waste your money, focus on the process of knowing how to trade or just make sure you’re consistently profitable. I do suggest to people that when they start, use a demo, you know, for a reason, be profitable on that. Go on to a small live account. Be consistently profitable on that, then maybe a slightly bigger live account, and use all those like that experience and those emotions that you’re going to have.

Andrew Mitchem

And get that right first before going on to a prop fund, because otherwise you’re just spending $500 and wasting you money.

Etienne Crete

In terms of platform, there’s a lot of choice. Are there? You can think, of course, so many different names is one that’s been around for a longer time, some that are newer and more competitive or kind of nicer offerings. How do you actually get to pick the prop firm and then maybe have some thoughts on this?

How to pick a prop firm.

Andrew Mitchem

But yeah, no, it’s I suppose you want to look at potentially, you know, a company’s been around for a long time. That’s always, I suppose, a good starting point. But the other one is I like, personally, I like prop firms that have slightly bigger drawdown allowances and, the some of those that I personally use that have two stages of a challenge before you go to live money, a lot of them would have like a 10% profit target and maybe like a 5% drawdown.

Andrew Mitchem

I think that’s it’s a little bit of a tight criteria for a lot of people. Whereas I’m now using prop firms that have a maybe like a 10% profit, 10% drawdown. And then you go on to another stage where you have to maybe make like a 5% profit again, within a 10% drawdown. And then you go to real money.

Andrew Mitchem

So yes, it might take longer, but having that bigger drawdown just allows a little bit more wiggle room for you as a trader. And I also think it’s really important that people don’t have a prop firm that has a time restrictio