In this post I will be reviewing TopstepTrader where aspiring traders can learn to trade and get a funded account should they prove to be successful. Topstep is located in Chicago and was founded in 2010 by current CEO and former Dow futures contracts floor trader, Michael Patak.
What is TopstepTrader?
TopstepTrader is a trading service that evaluates trader’s performance in real time on simulated accounts and recruits those who are successful.
Traders who pass the company’s evaluation earn a funded trading account and trade Forex and futures contracts in the financial markets using the firm’s capital. TopstepTrader’s funding process consists of three steps. The first step is an evaluation of the trader’s profitability, the second step proves the trader’s risk management, and the last step is the funded trading account
According to the Omaha World Herald, the name TopstepTrader was chosen because the best traders within each trading pit stand on the top step, where they have the best view and could theoretically receive the best market prices.
How to use TopstepTrader?
The first step to becoming a funded trader with TopstepTrader is to subscribe to the platform on a monthly basis. The minimum fee for this is $150 but it can go up to $375 depending on the option that you choose.
If you pass this stage by meeting the firm’s performance criteria, you will then be able to trade using Topsteps own capital.
Traders on the simulation can trade any CME Group product, while funded traders also have access to EUREX products.
It is woth mentioning that if you blow up your trading account during the simulation phase, TopstepTrader can charge you a few to reset the account. There may also be transaction fees for the trades you place via the platform.
How to get funded at TopstepTrader?
As mentioned above, there are certain criteria you must reach during the initial phase in order to become a funded Topstep trader. The first thing is to hit a profit target and show you can do so without taking lots of unnecessary risks. This can include not holding positions into economic releases, and staying within a weekly loss limit.
TopstepTrader have very strict requirements to get a funded account which is fair enough in my opinion. I don’t blame them for not giving away accounts to traders who are most likely going to blow them. What’s more, if you are one of those skilled traders lucky enough to get funded, you will need to keep up the performance or be put back on the simulation platform.
How does TopstepTrader make money?
Topstep earns a revenue from the 20% profit share of funded trader account and also from the monthly fees that they charge to access their practice platform.
How much does it cost?
There are four different TopstepTrader plans to choose from, each of which have the same features just with different account parameters such as profit target and maximum drawdown.
TopstepTrader uses the Tradovate platform. Tradovate is a futures brokerage that employs a subscription-based commission model.
There are multiple ways in which the charts display data, this includes candlesticks, bars, line, bid/ask volume, heiken ashi, renko, and point & figure. These charts also give you the opportunity to display bars according to time periods, ticks, volume, range, and momentum range. The platform also includes a newsfeed and position analysis screen.
There is a market replay feature implemented by TopstepTrader within the Tradovate platform. It allows you to choose the start date, start time, start balance and speed. This can be a great way to practice improving your trading strategy and to learn from any mistakes.
TopstepTrader is a good idea from my perspective. It benefits both traders and Topstep themselves, giving a chance for traders with little capital to trade full-time whilst forcing you to have high standards for your trading.
The program is designed to help you manage risk, hone strategies, and become consistently profitable. It rewards sound risk management and helps build productive habits.
It does seem like the majority of the companies’ earnings may be coming from the monthly simulation fee due to the lack of traders who manage to pass this stage.
If you are considering a service such as TopstepTrader, you could spend plenty of time practising your trading strategy on another trading platform such as MetaTrader 4 (MT4). You could do this until you are extremely confident that you will be able to reach the minimum requirements to get a funded account. That way, you increase your chances of not wasting the monthly fee required for a simulation account.
Regardless, TopstepTrader can be a great way to see if you are a profitable trader and to challenge yourself to reach the goals that they set. If you are one of the few who manage to successfully pass the simulation stage, you can get a funded account to trade on behalf of the firm.