Every term, in plain words.
28 prop firm, futures and ICT terms you'll meet on the way to a payout.
Prop firm rules
- Prop firm
- A company that lets you trade its capital, usually after you pass an evaluation, and pays you a share of the profits. Most retail prop firms run accounts in simulation and pay from fees and performance.
- Evaluation (challenge)
- The test you pay for to prove you can hit a profit target without breaking the risk rules. Pass it and you get a funded account.
- Funded account
- The account you trade after passing. Profits above the rules' buffer can be withdrawn as payouts; breaking a hard rule closes it.
- Trailing drawdown
- A max-loss line that rises with your highest balance and never moves down. Hit it and the account is breached. Most firms stop trailing once it reaches your starting balance.
- End-of-day drawdown
- A trailing drawdown recalculated only at the daily close, from your highest closing balance. Open profit that comes back during the day does not move it.
- Intraday drawdown
- A trailing drawdown that follows your highest balance in real time, including open profit. Stricter than end of day: a winner that reverses still lifts the line.
- Static drawdown
- A fixed max-loss level that never moves, common at CFD firms (for example 10% below the starting balance).
- Daily loss limit
- The most you may lose in one trading day. Some firms breach the account, others only lock it until the next session.
- Profit target
- The profit you must reach to pass an evaluation, usually 6% of the account on futures (3,000 dollars on a 50K).
- Consistency rule
- Caps how much of your total profit a single day may represent (for example 40%). It stops one lucky day from passing the evaluation or funding a payout.
- Profit split
- The share of withdrawn profit you keep. 90/10 means you keep 90% and the firm 10%.
- Payout
- A withdrawal of profit from a funded account. Firms set a cadence (daily, every 5 trading days, bi-weekly), a minimum and sometimes a cap.
- Payout buffer
- Profit you must keep in the account above the drawdown before you can withdraw anything.
- Activation fee
- A one-time fee some firms charge after you pass, before the funded account goes live.
- Reset
- Paying to restart an evaluation from zero after a breach or a bad start, usually cheaper than a new purchase.
- Instant funding
- A funded account bought directly, with no evaluation. Costlier, often with tighter consistency rules.
- Copy trading
- Mirroring one account's trades onto your other accounts. Many firms allow it between accounts you own; some forbid any copier.
Futures
- Micro contract
- A futures contract one tenth the size of the mini: MNQ is a tenth of NQ, MES of ES. Ideal to size down within a tight drawdown.
- Tick
- The smallest price step of a contract. On NQ a tick is 0.25 point and worth 5 dollars; on MNQ, 50 cents.
ICT concepts
- Fair value gap (FVG)
- A three-candle imbalance where the middle candle moves so fast that the wicks of the first and third candles don't overlap. ICT treats it as a zone price often revisits.
- Order block
- The last opposite candle before a strong move, read as the area where large orders were placed. Price returning there is a potential entry.
- Liquidity
- Clusters of stop orders above old highs (buy-side) and below old lows (sell-side). ICT reads price as moving from one pool of liquidity to the next.
- Market structure shift (MSS)
- A break of the last swing in the opposite direction after a liquidity sweep, taken as the first sign the move is turning.
- Killzone
- A time window when ICT expects the best moves: London (2–5 am New York), New York AM (8:30–11 am) and New York PM (1:30–4 pm).
- PD array
- Premium/discount array: any reference zone (order block, FVG, breaker, old high or low) ICT uses to decide where to buy or sell.
- Silver Bullet
- An ICT time-based model: within a one-hour window (for example 10–11 am New York), wait for a liquidity sweep, then enter on the first fair value gap toward the next pool.
- Opening gaps (NWOG, NDOG)
- The new week opening gap is the space between Friday's close and Sunday's open; the new day opening gap, between one session's close and the next open. ICT uses them as price magnets.
No term matches.