I have always been interested in trading but never comfortable with the idea of risking a large chunk of my own savings to do it seriously. Most retail traders need at least $10,000 to $25,000 in their account just to have enough capital to make meaningful returns, and the idea of putting that much on the line while learning felt like a bad deal.
Then I came across prop trading, and it genuinely changed how I thought about getting into the markets.
What Prop Trading Actually Is
Prop trading, short for proprietary trading, is when a firm gives a trader access to its capital to trade with. Instead of risking your own money, you trade the firm’s funds and keep a percentage of the profits you generate. The firm takes on the capital risk, and in return, you split the gains.
This is different from retail trading, where everything you make or lose comes directly out of your own pocket. With a prop firm, your personal financial exposure is limited mostly to the cost of getting evaluated and onboarded, which I will get into shortly. The model has been around for decades in institutional finance, but over the past several years it has become genuinely accessible to independent traders working from home.
How the Evaluation Process Works
Most prop firms do not just hand you a funded account on day one. The standard process involves passing a trading challenge, which is essentially a simulated or live evaluation period where you have to hit a profit target while staying within certain risk rules.
A typical challenge might ask you to grow an account by 8% to 10% within 30 to 60 days, while never losing more than 5% in a single day and keeping total drawdown under 10%. If you pass, you move to a verification or second phase, and then get access to a funded account. The whole thing is designed to prove you can trade consistently and manage risk before the firm trusts you with real capital.
The catch is that these evaluations usually cost money upfront, anywhere from $50 for a small account to several hundred dollars for larger ones. That fee is the main cost most traders face going in, and it is not always refunded even if you pass, though some firms do refund it on your first payout.
Why It Works as a Side Hustle
The appeal from a side hustle perspective is real. You are not quitting your job or committing your savings. Most traders work on prop accounts during hours that fit around their existing schedule, since forex and crypto markets run around the clock and even stock market traders can find setups before or after regular work hours.
The scalability is another draw. Once you are consistently profitable on a smaller funded account, many firms let you scale up to larger capital allocations, sometimes reaching $200,000 or more. At a standard 80% profit split, generating even modest monthly returns on that kind of capital starts to add up to meaningful income.
It also forces discipline in a way that casual retail trading often does not. The strict drawdown rules mean you cannot blow up an account with one bad day and start over. That structure, frustrating as it sounds at first, is actually one of the reasons some traders perform better in a prop environment than they ever did trading their own money.
Skills You Actually Need
This is where a lot of beginners underestimate the difficulty. Prop trading rewards consistency, not occasional big wins. Firms are looking for traders who can grow an account steadily while protecting the downside, not someone who doubles the account one week and gives it all back the next.
Risk management is the foundational skill. Knowing exactly how much you are willing to lose on any given trade before you enter it, and sticking to that, is what separates traders who keep their funded accounts from those who lose them repeatedly.
Trading psychology matters just as much. The pressure of a profit target with a drawdown ceiling creates a specific kind of mental environment that trips up even experienced traders. Overtrading when behind, or becoming overly cautious when close to the target, are both common failure patterns that have nothing to do with strategy and everything to do with mindset.
The Real Costs and Limitations Worth Knowing
Prop trading is not free money, and it is worth being clear about that. The evaluation fee is a real cost, and many traders fail their first challenge and pay again. Some pay for multiple attempts across different firms before finding a consistent approach. That adds up, and it is a number worth tracking honestly.
Funded accounts also come with rules that can feel restrictive. Daily loss limits, maximum drawdown thresholds, rules about holding trades overnight or over weekends, and restrictions on trading during major news events are all common. Violating any of these can result in losing your funded status instantly, even if your overall account balance is still positive.
There is also the question of payouts. Some firms pay out quickly and reliably. Others have slow processes, vague terms, or conditions that make it harder to actually withdraw profits. Reading the fine print on payout structures before committing to an evaluation is not optional.
Choosing a Firm Without Getting Burned
The prop firm space has grown fast, and not every firm operating in it is legitimate. Some exist primarily to collect challenge fees with no real intention of funding traders long-term. Others have strong reputations, transparent terms, and verifiable payout histories.
One resource worth using before committing to any firm is Vetted Prop Firms, which tracks and reviews prop trading firms based on payout reliability, rule structures, trader feedback, and overall legitimacy. It cuts down significantly on the research time involved in figuring out which firms are worth trying. When I was first looking into this space, having a curated list of reviewed firms was far more useful than piecing together opinions from random forum posts.
Beyond using a resource like Vetted Prop Firms, a few practical filters help. Look for firms with verifiable payout proof from real traders, clear rule documentation, and responsive support. Avoid any firm that makes unrealistic income claims or pressures you into upgrading account sizes before you have passed anything.
What Realistic Income Looks Like
This is the part most articles gloss over, so I want to be direct about it. Prop trading is not a get-rich-quick setup. Most traders who succeed with it treat it as a skill-based income stream that takes months of consistent work to build.
A trader who passes a $100,000 funded account and generates 4% to 5% per month would be looking at $3,200 to $4,000 per month at an 80% profit split. That is meaningful side income, but getting to that level of consistency takes time, and many traders are nowhere near those numbers in their first few months.
The more realistic starting point is a $10,000 or $25,000 account with modest monthly returns that grow as you scale up. Think of it less like a vending machine and more like a skill that pays better the better you get at it. Done consistently over time, those profits can compound into something meaningful and even contribute toward building financial independence down the road.
Is This Side Hustle Right for You
Prop trading makes the most sense for people who already have some trading background and want to take it seriously without risking their savings. It is also a reasonable path for disciplined learners willing to spend a few months developing a consistent strategy before attempting an evaluation.
It is probably not the right starting point for someone with zero trading experience looking for quick income. The learning curve is real, and paying for multiple failed challenges while still figuring out the basics gets expensive fast. Getting foundational education and screen time in a demo environment first is a smarter sequence than jumping straight into a paid challenge.
Conclusion
Prop trading is not passive income and it is not easy, but it is a legitimate way to participate in financial markets at a meaningful scale without putting your personal savings on the line. The barrier to entry is a skills test, not a capital requirement, which flips the usual dynamic of trading in a way that genuinely works in the trader’s favor. If you go in with realistic expectations, a solid risk management approach, and the patience to build consistency before scaling, it is a side hustle worth taking seriously.
This post may contain affiliate links.
More Recommended Ebike/Scooters
Check out these other ebikes and scooters I've reviewed:
- Urban Arrow Ebike – Last year, I made one of the largest purchases I’ve ever made – I bought a $9,000 electric cargo bike from Urban Arrow. In my Urban Arrow review, I will discuss what it is and why I decided to buy this bike, as well as discuss how impactful a bike like this can be on your journey to financial independence.
- Troxus Explorer Step-Thru Ebike – The Troxus Explorer Step-Thru is a fat-tire ebike that I’ve had the pleasure of riding for a while now. It has amazing power, great looks, and awesome range. If you’re looking for a great fat-tire ebike that offers a lot for the price, the Troxus Explorer Step-Thru is definitely one for you to consider. Check out my Troxus Explorer Step-Thru Review.
- Hovsco HovBeta Ebike – The HovBeta is a folding ebike with great specs and a lot of interesting features, and importantly, it’s sold at a good price point. I’ve had a blast commuting with it and using it to do deliveries with DoorDash, Uber Eats, and Grubhub. Check out my Hovsco HovBeta Ebike Review.
- Vanpowers Manidae Ebike – The Vanpowers Manidae is a fat tire ebike that I’ve been riding as my primary winter commuting bike and have also been using it to do food delivery with apps like DoorDash, Uber Eats, and Grubhub. After clocking in a decent number of miles with this ebike, I wanted to write a post sharing what my experience with the Vanpowers Manidae ebike has been like. Check out my Vanpowers Manidae Review.
- Sohamo S3 Step-Thru Folding EBike Review – A Great Value Folding Ebike – The Sohamo S3 Step-Thru Folding Ebike is an entry-level folding ebike that offers a lot of value for the price point. I’ve been riding the Sohamo S3 for a while now, putting the bike through its paces, and I have to say, this bike has exceeded all of my expectations. Check out my Sohamo Review.
- KBO Flip Ebike – The KBO Flip is an excellent bike. I’ve had a great time riding it and think it’s a versatile bike that can be used for a lot of purposes and can fit a variety of lifestyles. It’s worked out great for me as a general commuter bike and as a food delivery bike. Check out my KBO Flip Review.
- Hiboy P7 Commuter Ebike – The Hiboy P7 is an excellent electric commuter bike that’s offered at an affordable price point. The range and speed of this bike are both very good, so you won’t have any trouble getting anywhere you need to go with it. As a food delivery vehicle, this is also good – with how much range it offers, you’ll be able to work all day on a single charge. Check out my Hiboy P7 Commuter Electric Bike Review.
- Himiway Escape Ebike – The Himiway Escape is an interesting bike for anyone looking for a moped-style ebike. If you’re a gig economy worker, the Himiway Escape is particularly interesting and it’s possible to think of it as an investment, especially if you can opt to do deliveries with the Himiway versus using a car. It’s not cheap, but you can definitely make your money back when you compare the mileage you’ll put on your car versus using an ebike. Check out my Himiway Escape Bike Review.
- Espin Sport Ebike – The Espin Sport is a good ebike for someone who is looking for an ebike that feels and rides more like a regular bike. There are many ebikes that are really only bikes in name. In reality, they’re basically electric mopeds. The Espin Sport, by contrast, is a bike you could probably ride without the battery and you’d feel like you’re just riding a regular bike. Check out my Espin Sport Review.
- Varla Eagle One Scooter – The Varla Eagle One is an excellent scooter that can make sense for a lot of people. It can work as a primary mode of transportation. You can use it to work on gig economy apps like DoorDash, Uber Eats, and Grubhub. And it can also be a recreational vehicle if you’d prefer to use it for that. Check out my Varla Eagle One Review.
- Varla Falcon Scooter – The Varla Falcon is an excellent scooter that offers a good amount of power at a lower price point compared to more powerful scooters. It’s not exactly an entry-level scooter, nor is it a high-powered scooter. I think it fits somewhere in-between those two categories – an intermediate scooter if I had to give it a category. Check out my Varla Falcon Review.
- Hiboy S2 Scooter – The Hiboy S2 is an excellent entry-level commuter scooter that's perfect for someone looking to save some money in transportation costs and improve their commute. Check out my Hiboy S2 Review.
- Hiboy S2R Scooter – The Hiboy S2R is one of the more interesting electric scooters I’ve been able to test out. It’s not a high-powered scooter, but for an everyday transport option, it’s very useful, especially given some of the unique features that it has. Indeed, for the price, the Hiboy S2R might be the best value scooter I’ve used. Check out my Hiboy S2R Review.
- Fucare H3 Scooter – The Fucare H3 is a fun scooter and I’ve enjoyed testing it out. For a daily commuter or quick trips or errands, the Fucare H3 is probably the scooter I’ll use. It’s portable and easy to maneuver, so it’s just easier to take on the road when I need it. Check out my Fucare H3 Scooter Review.
More Recommended Investing App Bonuses
For additional investing app bonuses, be sure to check out the ones below:
- M1 Finance ($75) – This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $75 for opening an account. Check out my M1 Finance Referral Bonus – Step-By-Step Guide.
- SoFi Invest ($25) – SoFi Invest is an easy brokerage account bonus that you can earn with just a few minutes of work. Use my SoFi Invest referral link, fund your SoFi Invest brokerage account with just $10 and you’ll get $25 of free stock. I also have a step-by-step guide for the SoFi Invest referral bonus.
- Robinhood (1 free stock) – Robinhood gives you a free stock valued between $2.50-$225 if you open an account using my referral link.
- Public (1 free stock) - Public gives you a free stock valued between $3-$70 if you open an account using my referral link.
More Recommended Bank Account Bonuses
If you’re looking for more easy bank bonuses, check out the below options. These bonuses are all easy to earn and have no fees or minimum balance requirements to worry about.
- Ally Bank ($100) – Of all the banks out there, Ally is, without a doubt, my favorite. At the moment, Ally is offering $100 to customers who open an eligible Ally account and meet the requirements. Here are the step-by-step directions to earn your Ally Bank referral bonus.
- Chime ($100) - Chime is a free bank account that offers a referral bonus if you use a referral link and complete a direct deposit of $200 or more. In practice, any ACH transfer into this account triggers the bonus. This bonus is easy to earn and posts instantly, so you’ll know if you met the requirements as soon as you move money into the account. I wrote a step-by-step guide on how to earn your Chime referral bonus that I recommend you check out.
- US Bank Business ($400/$1200) – This is a fairly easy bank bonus to earn, since there are no direct deposit requirements. In addition, you can open the Silver Business Checking account, which comes with no monthly fees. Check out how to earn this big bonus here.
- Current ($50) – Current is a free fintech bank that’s offering new users a $50 referral bonus after signing up for an account using a referral link. Current is an easy bonus to earn and also gives you access to three savings accounts that pay you 4% interest on up to $2,000. That means you can put away up to $6,000 earning 4% interest. That’s very good and makes Current an account I recommend to everyone. Check out my step-by-step guide on how to earn your Current Bank bonus.
- Novo Bank ($40) - Novo bank is a free business checking account that’s currently offering a $40 bonus if you open a Novo business checking account using a referral link. In addition to being a good bank bonus, Novo is also a good business checking account. It has no monthly fees or minimum balance requirements and operates a good app and website. Indeed, it’s the business checking account I currently use for this blog. Check out my post on how to easily open a Novo account.
- Varo ($25) – Varo is a free fintech banking app similar to Chime or Current. It’s currently offering a $25 bonus to new users that open a new Varo account with a referral link. The bonus for this bank is very easy to meet, all you need to do is spend $20 within 30 days of opening your Varo account. Check out my step-by-step guide to learn how to earn this bonus.
Kevin is an attorney and the blogger behind Financial Panther, a blog about personal finance, travel hacking, and side hustling using the gig economy. He paid off $87,000 worth of student loans in just 2.5 years by choosing not to live like a big shot lawyer.
Kevin is passionate about earning money using the gig economy and you can see all the ways he makes extra income every month in his side hustle reports.
Kevin is also big on using the latest fintech apps to improve his finances. Some of Kevin's favorite fintech apps include:
- SoFi Money. A really good checking account with absolutely no fees. You'll get a $25 referral bonus if you open a SoFi Money account with a referral link, and an additional $300 if you complete a direct deposit.
- 5% Savings Accounts. I'm currently getting 5.24% interest on my savings through a company called Raisin. Opening a Raisin account takes minutes to complete, it's free, and all of your funds are FDIC-insured. I explain how it works, why I'm now using it to store my emergency fund and any other cash savings I have, and why I recommend everyone check it out in this review.
- US Bank Business. US Bank is currently offering new business customers a $400/$1200 signup bonus after opening a new account and meeting certain requirements.
- M1 Finance. This is a great robo-advisor that has no fees and allows you to create a customized portfolio based on your risk tolerance. You also get $75 for opening an account.
- Empower. One of best free apps you can use to monitor your portfolio and track your net worth. This is one of the apps I use to track my financial accounts.
Feel free to send Kevin a message here.
Leave a Reply