The profit target is not what stops most candidates. The daily loss line, the news window and the weekend rule are. A structural read of the evaluation, dated and caveated.
Ask ten failed challenge candidates what went wrong and nine will describe a trading problem. Look at the account histories and most of them ended on a rule, not on a run of bad trades — a position held ten minutes too long into a rollover, a trade opened ninety seconds before a data release, a Friday position carried into a Sunday gap. The profit target is the visible obstacle. The constraints around it are what actually removes people.
This is a structural explanation of how the FTMO evaluation is put together and which parts of it do the removing. Before anything else, one warning that applies to the whole post.
WARNING
Prop-firm terms change, sometimes between account generations sold in the same month. Everything below describes the structure as published as of September 2026. Treat every number as something to verify against the current terms for the specific account you are buying, on the firm's own site, before you trade a single lot.
FTMO's evaluation is two stages, and the reason for the split is worth understanding because it tells you what each stage is testing.
Phase one, the Challenge, asks for the larger profit target. It is the filter for whether you can make money at all under the firm's constraints.
Phase two, Verification, asks for a smaller target over the same or a longer window. It is the filter for whether phase one was repeatable or was one good week. The loss limits do not relax between the two — only the target does.
Pass both and you are offered a funded account, where the profit target disappears entirely and only the loss limits remain. That asymmetry is the whole design: the firm is not paying for your best month, it is screening for a trader whose worst day is survivable.
As of September 2026 the widely published shape is a 10 per cent target in phase one, 5 per cent in phase two, with a 5 per cent daily loss limit and a 10 per cent maximum loss limit throughout, and a profit split starting at 80 per cent. Time limits and minimum-trading-day requirements have been changed more than once over the years — FTMO has both shortened and removed them at different points — so those are the first things to re-read rather than assume.
The daily limit is measured against your balance at the start of the firm's trading day, and it is evaluated on equity, which means floating loss on an open position counts before you close anything.
On a 100,000 dollar account starting the day at 103,000, a 5 per cent daily limit puts the floor at 97,850. Profit you make during that day does not raise the floor. That is the single most common misreading: traders bank 2,000 in the morning and behave as though they now have 7,000 of room, when they have the same 5,150 they started with plus whatever cushion the realised profit added.
The reset happens at a fixed server hour, not at your local midnight. If you are trading from a timezone several hours from the server's, your fresh daily budget arrives in the middle of a session, and a loss taken just before the reset consumes a day you barely used.
The overall limit is measured from the account's initial balance and does not move up as you profit — a static floor rather than a trailing one, in FTMO's published structure as of September 2026. A 10 per cent maximum on a 100,000 dollar account means equity must never touch 90,000, regardless of how high the account went first.
This distinction matters enormously when comparing firms. A trailing maximum drawdown follows your high-water mark: reach 108,000 and the floor rises to 98,000, so giving back 10,000 from a peak ends the account even though you are still in profit overall. A static floor is considerably more forgiving once you are ahead. Do not carry an assumption from one firm to another.
These are the ones that catch people who were trading perfectly well.
The news window. On standard accounts, opening or closing positions within a short window around high-impact scheduled releases is restricted. The practical trap is not the deliberate news trade — it is the automated entry that fires ninety seconds before the number, or the trailing stop that closes a position inside the window. If you run any automation, it needs a calendar filter, and the filter needs to know the same list of "high impact" events the firm uses.
Weekend holding. Standard accounts are generally not permitted to carry positions over the weekend; Swing-style accounts exist precisely to allow it, at the cost of other constraints. Traders who habitually hold swing positions buy the wrong account type and discover the mismatch on a Friday afternoon.
Prohibited practices. Every firm maintains a list of trading behaviours it will not fund. The categories are consistent across the industry: exploiting demo-feed or latency discrepancies, arbitrage against a faster feed, tick-scalping that depends on a pricing error rather than a market view, group trading where multiple accounts are coordinated by one party, and any attempt to hedge a challenge account against an external account so that one side always passes. These are judged on intent and pattern, not on a single trade, and the assessment happens at payout time, which is the worst possible moment to discover a disagreement.
Consistency expectations. Some account types and some firms apply a consistency check — no single day or single trade may account for an outsized share of total profit. Where this applies it is usually a condition on the payout rather than on the evaluation, and it is the clause most often missed entirely because it does not appear on the product page.
TIP
Before you buy, read the firm's full terms document rather than the marketing page, and save a dated PDF of it. If you later need to discuss a payout, the version of the terms in force when you bought is the document that matters, and it will not still be on the website.
Traders search for the current year's rules expecting a single changelog. There is not one. What actually happens is that firms revise product generations — a new account type appears with different limits, the old one stays available for a while, and both are described on the same site.
Three areas have seen the most movement across the industry over recent years, and are the ones most worth checking rather than assuming:
Anything written about a challenge more than a year ago should be treated as background, not as a checklist.
Most preparation advice is about strategy. The rules-first version is short and boring, which is why it works.
A rule set is a boundary, not a strategy. Staying inside the limits is necessary and not sufficient — plenty of candidates survive every rule and simply do not reach the target, which is the honest outcome of trading a strategy whose edge was never established.
There is also a structural point worth naming. The evaluation fee is the firm's product, and a challenge is a bet you place on yourself under conditions someone else wrote. It is a legitimate route to trading capital, and it is not a route to trading income that bypasses having an edge. Nothing about passing an evaluation makes a strategy profitable, and no account type, scaling plan or payout schedule changes that. Past results, yours or anyone's, do not establish future ones.
For the execution side — the drawdown arithmetic that decides how large each trade can be and when to stand down — read what-is-daily-drawdown. If the question you actually have is whether you may run an expert advisor or a copier on a challenge account, that is covered separately in ea-and-copiers-on-prop-firms.
