How Prop Firms Calculate Profit Targets
Profit targets decide whether you pass the evaluation or stay stuck paying resets. They’re not random, and they’re not based on what “feels fair.” Prop firms use a specific formula tied to account size, drawdown, and average trader performance. If you understand the math, you’ll know exactly which targets are realistic for your strategy.
The Logic Behind Profit Targets
Prop firms calculate profit targets using three factors:
- Account size
- Trailing drawdown amount
- Historical trader pass rates
Their goal is simple: make the target difficult enough to filter out weak traders but achievable enough to get repeat business.
Typical Profit Targets by Account Size
| Account Size | Profit Target |
|---|---|
| $25,000 | $1,500 |
| $50,000 | $3,000 |
| $100,000 | $6,000 |
| $150,000 | $9,000 |
| $250,000 | $15,000 |
Targets scale linearly because the firm expects you to take larger trades in larger accounts. It’s not personal — it’s just how their backend risk models work.
Why Targets Scale With Trailing Drawdown
Trailing drawdown and profit targets are linked. If a trailing drawdown is small, the profit target must be low too, or beginners have no shot.
Example:
- $25K account → $1,500 drawdown → $1,500 target
- $50K account → $2,500–$3,000 drawdown → $3,000 target
- $100K account → $3,000–$4,000 drawdown → $6,000 target
The firm expects you to grow your account faster than you risk losing it.
Profit Targets Are Built Around Microlot Math
Prop firms know most traders use micros, especially on $25K–$50K accounts. So they design the targets around realistic micro trading output.
Typical micro ATR-based potential per session on ES/NQ:
- Small day: $40–$120
- Moderate day: $150–$300
- Strong day: $300–$600
A $3,000 target usually takes 10–20 sessions of solid trading — not one massive day, which is why firms also check consistency rules.
Evaluation Time Limits and Targets
Most firms don’t force an evaluation time limit, but they design targets so the average trader runs out of psychological steam before hitting it.
- Too small a target? Everyone passes.
- Too big a target? No one pays after they fail.
Targets are engineered right in the middle.
Why Bigger Accounts Have Harder Targets
Bigger accounts assume you’re:
- Trading larger size
- Comfortable with volatility
- Using scaling techniques
If you’re trading micros on a $100K account, the target will feel impossible — most beginners are better suited for the $50K account.
Pass Rates and Profit Targets
Profit targets aren’t based on “fairness.” They’re based on math and behavior. Firms know:
- A target too low means too many payouts
- A target too high means traders quit
- The sweet spot is where 5–15% of traders pass
That pass rate is good business for the firm and achievable for disciplined traders.
Final Takeaway
Prop firm profit targets follow a formula built on account size, drawdown, and realistic performance. They’re not random — they reflect the firm’s risk model and expectations. Understand the target, trade small and steady, and you’ll hit it without relying on oversized hail-mary trades.