FundedNext and Stellar offer traders access to larger accounts for potential profits, but they do so in different ways, catering to various trading styles, risk tolerances, and goals. Within the world of proprietary trading, the number of firms allowing traders to trade company capital has increased significantly.
This has opened the door to a number of funding programs, each with its own set of advantages. Two of the most popular are FundedNext and Stellar; both offer traders the ability to scale their businesses by trading larger accounts and sharing in some of the profits.
Both programs involve an evaluation process to assess a trader’s skills and risk management ability, but they differ in what is evaluated, the costs involved, and the reward structure.
FundedNext Evaluation Process
FundedNext is well-known for its robust and trader-friendly evaluation process. It offers a comprehensive step-by-step pathway to securing a funded account, with an emphasis on making the process as clear and accessible as possible. The evaluation is divided into two phases: the Phase 1 Challenge and the Phase 2 Verification.
Phase 1 Challenge
The first phase of the FundedNext evaluation is designed to test a trader’s ability to reach a profit target while adhering to specific risk management rules. The key features are as follows:
- Profit Target: A trader is usually expected to hit a profit target within a certain period, often 10% of the starting account balance.
- Drawdown Limits: FundedNext has strict drawdown rules that prevent traders from surpassing predetermined limits. It’s done to reduce risks and protect both the trader and the firm.
- Evaluation Duration: Evaluation time is variable in different cases, but generally, this Phase 1 challenge would give ample time to prove yourself as a trader without being at a rush.
- Trading Styles: FundedNext is relatively flexible with its evaluation process, allowing a variety of trading styles, including scalping, swing trading, and position trading, as long as the risk management guidelines are followed.
Phase 2 Verification
After traders successfully pass Phase 1, they proceed to Phase 2, which is essentially a verification stage. During this phase, traders must prove that their success was not a fluke.Â
The goal is to demonstrate consistent, responsible trading by meeting profit targets over time, while managing risk to scale up for final approval.
FundedNext Costs and Fees
The evaluation fees for FundedNext vary by the account size selected. Most traders have to pay a one time fee to access the challenge, though there are no monthly recurring charges unless they progress through the stages.
FundedNext has various options available that let the trader scale their evaluation challenge as preferred and financially possible.
FundedNext Profit Sharing and Account Size
Upon successful completion of both stages of evaluation, traders are granted a funded account. The profit-sharing scheme will range from 70% to 90%, depending on the account size and other factors.
FundedNext’s profit-sharing model is competitive in the industry, with generous splits for successful traders. Also, there are various account sizes available at the company, which means traders can scale up quickly once they are approved.
Stellar Plans: A Different Approach to Funded Trading
Stellar offers a different take on the whole funded trading thing. It is similar to FundedNext in some ways because of how it allows traders to handle big accounts. However, when it comes to the process of evaluation and the general structure, the approach is a bit different.
Evaluation Structure
Also, the evaluation process in Stellar is divided into two phases, but the way these phases are set up differs significantly.
- Profit Objectives and Risk Management: Just like FundedNext, Stellar, too, has some profit target that the trader needs to achieve. However, the precise profit target and the time period for evaluation may vary with the selection of account size. Stellar does put a great emphasis on risk management, often granting tighter drawdown limits compared to FundedNext.
- Freedom to Trade: While there are various trading strategies allowed for both programs, Stellar’s assessment is usually more biased toward continuity than aggressive trading. They will often expect traders to show somewhat consistent daily or weekly returns, without large swings in the equity.
- Time Frames:Â Stellar may enforce a more stringent time frame on assessment phases, where traders would be expected to reach profit objectives in a fixed period. This will, in effect, be of greater benefit to traders who look to have a quicker path to a funded account; but this also puts pressure on the traders who prefer measured time.
Stellar Plans Fees and Account Sizes
Similar to FundedNext, Stellar charges fees for accessing its evaluation process. The fee structure is based on the account size selected. However, Stellar tends to have a more diverse range of account options, including lower-cost entry points for traders who are just starting out.
The major difference between FundedNext and Stellar is the account type a trader gets after evaluation. Stellar offers everything from a standard account to higher leverage accounts, catering for traders who want to take on more aggressive risks. This could be more appealing for certain traders since it would help them fit their particular needs with regard to leverage and personal risk tolerance.
Stellar Plans Profit Sharing
Stellar’s profit-sharing starts at 50% for smaller accounts and increases for larger ones, directly affecting traders’ earnings with firm capital.
Key Differences Between FundedNext and Stellar Plans
While both FundedNext and Stellar offer traders a way to funded accounts that could lead to significant profit, several important differences exist that could affect which one a trader may want to choose.
1. Evaluation Criteria and Flexibility:Â
FundedNext: Â allows a more flexible evaluation process because it can fit in any style of trading while focusing more on risk management and the profit target within a reasonable time frame.
Stellar: focuses more on the aspect of consistency and risk control, hence, always trying to set stricter time limits and allowing for more conservative profit targets. This may be beneficial for traders who want a quicker evaluation but could feel restrictive for those who prefer longer and more relaxed challenges.
2. Profit Sharing
FundedNext: Has more flexible profit-sharing, especially on larger account sizes. This means traders will have a higher percentage of profits, sometimes as high as 90%.
Stellar: Tends to be a little more conservative with their profit sharing, starting lower at 50% and scaling. This can be a concern for traders wanting a higher share of the profits.
3. Account Sizes and Costs
FundedNext: though still offering a range of account sizes, leans more toward experienced traders with larger account options.
Stellar: Both have many account sizes, but Stellar offers more flexibility toward lower-cost entry options. This can make Stellar more accessible to the more ‘green’ trader who is just getting started.
4. Evaluation Phases
FundedNext: Evaluation has a clear and well-structured step-by-step approach, which is also quite easy for the traders to operate and understand.
Stellar: would want the trader to achieve certain expectations in consistency and risk management while maintaining less aggressive profit targets.Â
5. Support and Tools
FundedNext: Both firms provide strong trader support, but FundedNext tends to have a more extensive network of resources for traders, such as educational content and advanced tools for risk management.
Stellar: Provides a solid support system, although it may not be as comprehensive as FundedNext in terms of resources for traders.
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Frequently Asked Questions (FAQs)
What is the difference in profit sharing between FundedNext and Stellar?
- FundedNext offers more attractive profit-sharing rates: up to 90% depending on account size, whereas Stellar would offer profit sharing starting from 50% on smaller accounts, which may grow with increasing account size.
How do the account sizes differ between FundedNext and Stellar?
- FundedNext and Stellar have different account sizes. FundedNext offers traders a choice for their account size, which suits various trading styles. Stellar tends to have more options, with cheaper entry accounts for beginners, and for more experienced traders, higher leverage options may be available.
Do both FundedNext and Stellar provide support for traders?
- Yes, both FundedNext and Stellar have trader support, but FundedNext has a wider range of resources, including educational content, trading tools, and guidance on risk management. Stellar also does a good job with support, but its resources may not be as extensive as FundedNext.
Can I upgrade my account after passing the evaluation?
- Both FundedNext and Stellar permit traders to scale their accounts after the evaluation process. On FundedNext, traders can select larger account sizes, and on Stellar, there are different account types that a trader can consider, with various leverage options open to them. Traders will be able to scale according to their needs and the results of their trading activity.
Can I trade any market on both platforms with a funded account?
- Both FundedNext and Stellar enable traders to trade in a variety of markets, such as Forex, commodities, and indices. However, specific market conditions and asset classes available might differ between the two platforms and depend on the type of account. Traders are expected to go through the terms of their funded account and comply with the allowed markets.
Do FundedNext and Stellar offer demo accounts for practice?
- Yes, both FundedNext and Stellar offer demo accounts to practice for traders before engaging in the evaluation process. The demo account will give traders an opportunity to test their strategies and familiarize themselves with the trading environment as if it were real market conditions.
