Account Balance
The cash value of a trader's account, excluding open floating P&L. Used as the baseline for daily loss and overall drawdown calculations.
Glossary
Prop trading glossary
Master the language of prop trading. Clear, accurate definitions for every term you need to know — from A to Z.
94+ definitions · Covering all 26 letters
A6 terms
Affiliate Program
A revenue-share system that pays partners for referring traders. PropFirmCRM supports multi-level affiliates, custom commission tiers, and automated payouts.
API Integration
A programmatic interface that lets external systems (PSPs, KYC providers, data warehouses) push and pull data from your CRM in real time.
Automated Payouts
Rule-based withdrawal processing — the system calculates eligibility, applies splits, and disburses funds via the connected PSP without manual approval.
Active Trader
A funded or evaluation account that has placed at least one trade within a defined window. Used in cohort and retention analytics.
Anti-Hedging Rule
A risk rule that prevents traders from opening offsetting positions across related accounts to game evaluation metrics.
B5 terms
Back Office
The internal operations layer — accounts, payouts, compliance, support and reporting — that runs your prop firm behind the trader-facing portal.
Broker
A regulated firm that executes trades on behalf of clients. Prop firms typically partner with brokers or run their own hosted Platform 5 environment.
Bonus Challenge
A promotional challenge type offering reduced fees, larger account sizes or scaling boosts to attract new traders.
Bid/Ask Spread
The difference between the highest buy price (bid) and the lowest sell price (ask). Narrow spreads typically indicate higher liquidity.
Breach
Any event where a trader crosses a configured risk limit — daily loss, overall drawdown, or a custom rule — triggering automatic action.
C6 terms
Challenge Account
An evaluation account a trader must complete (1-step, 2-step or instant funding) to qualify for a funded payout-eligible account.
Consistency Rule
A profit-distribution rule requiring that no single day account for more than a configured percentage of total profit.
Commission
A per-trade fee charged on volume. In prop firms, commissions can be rebated to affiliates or factored into payout calculations.
CRM
Customer Relationship Management — the platform that unifies trader accounts, communication, KYC, payments and analytics in one system.
Custom Rules
Risk parameters composed from primitives (equity, drawdown, symbols, time windows) that go beyond standard templates.
Cohort
A group of traders or accounts sharing a common attribute (signup month, plan, region) used for retention and revenue analysis.
D5 terms
Drawdown
The decline from a peak in account equity, expressed as an absolute value or a percentage. The core metric for measuring trader risk.
Dashboard
A visual interface showing live operational metrics — equity, breaches, exposure, payouts — at a glance, with drill-downs for detail.
Demo Account
A non-funded practice account used by traders to test strategies. In prop firms, evaluation phases are typically run on demo-style infrastructure.
Daily Loss Limit
The maximum permitted loss within a single trading day. Crossing it instantly triggers a breach action — warn, throttle or force-close.
Device Fingerprint
A persistent identifier built from browser, hardware and network signals — used to detect multi-accounting and fraud rings.
E5 terms
Equity Curve
A time-series chart of an account's equity, used to visualize performance, drawdown and consistency over an evaluation or funded period.
Evaluation Phase
The qualifying stage a trader must pass — typically a profit target combined with risk and consistency rules — before becoming funded.
Expert Advisor
An automated trading algorithm that runs on the platform. Prop firms may allow, restrict or audit EAs depending on rules.
Exposure
Total open position value across an account, cohort or firm, broken down by symbol, currency or asset class.
Evidence Bundle
A signed export of trades, IPs, devices, rule firings and timestamps attached to a flagged account for review or dispute resolution.
F4 terms
Funded Account
A payout-eligible account granted to a trader after passing evaluation. Profits are shared between the firm and the trader per the agreement.
Fraud Detection
Automated pattern matching that identifies copy-trading rings, hedging across traders, latency arbitrage and other rule abuse.
Free Margin
The portion of account equity not currently used to maintain open positions — the buffer available to open new trades.
Force-Close
An automatic risk action that closes all open positions on an account the moment a configured rule is breached.
G3 terms
Growth Plan
A tier of PropFirmCRM aimed at scaling firms — adds advanced fraud signals, custom rule templates, and regional data residency options.
Grid Trading
A strategy that places staggered orders above and below a price level. Often restricted by prop firm rules due to risk concentration.
Geo-Velocity
A fraud signal that flags physically impossible logins — for example, two sessions from continents apart within minutes.
H3 terms
High-Water Mark
The highest equity value reached on an account. Trailing drawdown rules anchor to this point until a new high is set.
Hosted Platform 5
Fully managed trading server infrastructure delivered as part of PropFirmCRM — no setup, no maintenance, instant account provisioning.
Hedge Ring
A coordinated abuse pattern where multiple accounts open offsetting positions to capture guaranteed profit on one side.
I4 terms
Instant Hosted Platform 5 Accounts
On-demand provisioning of trading accounts — the trader buys a challenge and trades within seconds, no manual setup.
IB (Introducing Broker)
A partner who introduces traders to the firm in exchange for a share of fees or spread. Tracked and paid through the affiliate engine.
Integration
A connection between PropFirmCRM and an external system — PSPs, KYC providers, trading platforms, analytics tools, or webhooks.
Immutable Audit Log
A tamper-evident record of every risk event, override and notification — required for compliance and dispute defense.
J2 terms
Journaling
Structured trade-by-trade notes a trader keeps for review. Prop firms may expose journaling tools inside the trader portal.
Jurisdiction
The legal region a firm or trader operates in. Drives KYC requirements, data residency, and which payout rails are available.
K2 terms
KYC (Know Your Customer)
Identity and address verification performed before activating funded accounts or processing payouts. Powered by providers like Sumsub and Veriff.
Kill Switch
An automated or manual action that disables trading, blocks orders or freezes an account the instant a rule is breached.
L4 terms
Leverage
The ratio between the trader's notional exposure and the underlying capital. Higher leverage amplifies both gains and losses.
Liquidity Provider
The institution supplying executable quotes to the trading platform. Quality of liquidity affects spreads, slippage and fill rates.
Loss Limit
A configured floor — daily or overall — past which an account is breached. The foundational rule of every prop firm's risk model.
Latency Arbitrage
A rule-abuse pattern where traders exploit delayed quotes. Detected by latency anomaly scoring and tick-burst clustering.
M4 terms
Multi-Level Affiliate
A program that rewards partners not just for direct referrals but also for sub-affiliates they recruit — configurable in PropFirmCRM.
Margin Call
A notification (or automatic action) when free margin falls below a threshold and the account is at risk of stop-out.
Minimum Trading Days
A rule requiring traders to be active across a minimum number of days during the evaluation, preventing single-day luck passes.
Multi-Accounting
A fraud pattern where one individual operates multiple accounts to abuse promotions or split risk. Caught via fingerprint graphs.
N3 terms
News Trading Rules
Restrictions or throttles applied around scheduled economic events to prevent abuse of stale quotes and execution gaps.
Net Profit
Gross trading profit minus commissions, swaps and any deducted fees. The figure used to compute payout eligibility.
Notification Channel
A delivery path for alerts — email, in-portal banner, webhook, Slack, PagerDuty — configurable per rule and per role.
O3 terms
Overall Drawdown
The maximum cumulative loss permitted from the account's starting balance or high-water mark across the entire lifecycle.
Order Execution
The process of converting a trader's order into a filled position. Quality is measured by speed, slippage and rejection rate.
Override
A manual admin action — pausing a rule, reversing a trade, releasing a held payout — fully attributed in the audit log.
P5 terms
Payout
A withdrawal of a trader's share of profits, processed through the connected PSP under the firm's payout policy and schedule.
Platform 5
The leading retail trading platform used by most prop firms. PropFirmCRM ships with hosted Platform 5 wired into the risk engine natively.
Prop Firm
A proprietary trading firm that funds external traders against its own capital and shares the resulting profits.
PSP Integration
A live connection to a payment service provider for collecting challenge fees and disbursing payouts — Stripe, Visa rails and more.
Profit Split
The percentage of net profit returned to the trader (e.g. 80/20) — configurable per plan, per challenge or per cohort.
Q2 terms
Quality of Execution
A composite measure of fill speed, slippage and rejection rate. Tracked per symbol and per liquidity feed.
Quote Feed
The real-time stream of bid/ask prices delivered to the trading platform. Outages or staleness can trigger risk-engine alerts.
R4 terms
Risk Management
The combined system of rules, monitoring, automated actions and audit tooling that protects the firm from uncontrolled losses.
Referral Program
An affiliate-style program where existing traders earn rewards for bringing new traders into the firm.
Real-Time Monitoring
Sub-second observation of equity, exposure, rule status and breach signals across every account, with no polling delay.
Rule Builder
A visual editor for composing custom risk rules from primitives, with dry-run mode to validate before going live.
S5 terms
Scaling Plan
A program that increases a trader's account size as they hit consistent profit milestones — automatable in PropFirmCRM.
Sumsub
A leading KYC and AML provider integrated with PropFirmCRM for identity verification and ongoing compliance checks.
Stripe Integration
A native payment connection for collecting fees, handling refunds and tracking subscription revenue at the firm level.
Swap-Free
An account type that does not charge or pay overnight financing — often offered for religious-compliance reasons.
Soft Freeze
A risk action that blocks new orders while leaving existing positions open, used pending admin review.
T4 terms
Trader Portal
The branded interface where traders manage accounts, view drawdown, request payouts and see live rule status.
Turnkey Solution
A complete ready-to-run prop firm stack — CRM, hosted platform, risk, payouts and KYC — delivered as one product.
Trailing Drawdown
A drawdown floor that follows the high-water mark up but never down — a stricter variant of overall drawdown.
Tick
The smallest price movement of an instrument. Risk evaluation runs at tick precision in PropFirmCRM, not minute candles.
U2 terms
Uptime Guarantee
A service-level commitment to platform availability — PropFirmCRM targets 99.99% on the risk engine and hosted Platform 5.
Unlimited Trading Days
A challenge variant with no minimum or maximum day requirement, letting traders qualify at their own pace.
V4 terms
Veriff
A KYC and identity verification provider integrated with PropFirmCRM as an alternative or complement to Sumsub.
Visa Integration
Direct payout rails via Visa Direct for fast, card-based withdrawal disbursement to eligible traders.
Volume Requirement
A minimum traded volume — by lots or notional — required before a payout becomes eligible.
VPN Rotation
A multi-accounting tactic where a single individual cycles through VPN exits to mask identity — caught by fingerprint graphs.
W3 terms
Webhooks
HTTP callbacks that push real-time events from PropFirmCRM to your warehouse, Slack, PagerDuty or any custom system.
White-Label CRM
A fully branded deployment of PropFirmCRM under your own domain, logo and theme — your brand, our engine.
Withdrawal Processing
The end-to-end flow that takes an approved payout from request to PSP disbursement and final confirmation.
X2 terms
XAU/USD
Spot gold quoted against the US dollar — one of the most-traded instruments in prop trading, often with stricter rule windows.
XAG/USD
Spot silver quoted against the US dollar — a common commodities CFD on prop firm platforms.
Y2 terms
Yearly Performance
Aggregated trader and firm metrics across a full year — revenue, payouts, retention, and breach rates — used for board reporting.
Yield
Net return generated on a funded account relative to its starting balance over a defined period.
Z2 terms
Zero Revenue Share
A pricing arrangement where the firm keeps 100% of platform-related revenue while paying traders only on net profit splits.
Zone Pricing
Region-specific pricing for challenges, often used to adjust for purchasing power and local PSP availability.
Why this glossary matters
Speak the language. Run a better firm.
Prop trading runs on shared vocabulary. When your team, your traders, your auditors and your partners all use the same definitions, decisions get faster, disputes get shorter, and growth gets cleaner. This glossary is the reference we use internally — kept current as the industry evolves.
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