What is a prop firm?
A prop trading firm is a company that provides its traders with access to capital. In return, the traders in the firm have to share a share of their profits with the firm. Professional trading is not an easy task because it comes with numerous challenges for individuals. Top 5 Prop Firm Technology you need to know.
Key Takeaway points
- Launching a prop trading firm requires a mix of human expertise and tech.
- While the margins are high, building a sustainable prop firm requires infrastructure.
- The trading platform because it is the first and the central point of contact for funded and soon-to-be-funded traders.
Do prop firms pay a salary?
Legitimate Prop Trading Firms – These companies in exchange for idleness, use to pay you a basic salary and perks, provide training, and allocate you to a team to facilitate your growth. They hire from universities and also hire traders from other companies.
The Best Technologies to Start a Proprietary Trading Firm in 2025 (Top 5 Prop Firm Technologies)
Let’s consider the fact that in 2025 starting a prop firm, you need a very strong and solid base of technology to establish yourself as a prop firm and draw in more traders. Keeping in mind the rate of radical innovations that occur daily, prop firms are expected to adopt the most advanced tools and systems to enhance their operations, trading performance as well as risk management. In this article, we will look at the leading five technologies that are crucial for a prop firm.
Here are a few technologies you need to start a prop trading firm:
1. A Trading Platform To Use For Prop Firms
Switching back to the discussion about prop firm brokerage tech, a few key components are of importance. Most importantly, the trading platform because it is the first and the central point of contact for funded and soon-to-be-funded traders. Some of the popular trading platforms are cTrader, MT4, and MT5.
The trading platform is required to support practice market accounts for traders who are still in the challenge stage and actual market accounts for those who have qualified. Additionally, it must enable cross-asset trading and be deployed to a low-latency network environment.
Such information must also be delivered via a data market feed service, which should be heterogeneous accurate, and stable. For that, they need good execution and solid moist conditions. This is where technology solutions like liquidity bridges or MT5 gateways come in. Adoption of these execution engines can ensure uniform and reliable execution practices necessary for ensuring frequent active trader satisfaction.
2. Prop Trading CRM
The dashboard for onboarding and payment processing is handled by a CRM. What distinguishes a financial services CRM from other types of software are the KYC and AML built into modules of the system.
These CRMs also enable a large number of payment service providers, enabling to accept payment from any region worldwide. This specialized functionality ensures compliance and streamlines transactions in the financial industry.
3. Live Dashboards
A trader has to evaluate the health of their account as closely as possible whether trading is happening in live markets or phases of the challenge. To do this, they need a real-time view of their account health through a simple and intuitive client dashboard like the ones offered in Brokeree’s Prop Pulse solution, which has intuitive dashboards that highlight winning and unsuccessful accounts and several other information like passing a challenge, balance, account history, challenges purchased, and failed objectives
4. Risk Management Tools
Risk Management is an important aspect of managing a prop firm brokerage. There are many risks that can have an impact on prop firm account management services.
You need to safeguard themselves against losses and offer a safe trading environment for their traders. To achieve this, they must take into account robust risk management settings for any prop trading solutions they adopt.
For instance, with automated risk management tools such as Prop Pulse, the risk of forgetting to set stop loss and take profit levels can be mitigated by admins setting flexible thresholds that automatically close open positions and move the account into read-only mode. Another risk is overtrading, which can be managed by setting trading limits and monitoring trading activity to detect any unusual patterns.
5. STP and Market Making
Another way can improve trade execution speed, reduce slippage, and earn extra revenue from the bid-ask spread is by combining Straight Through Processing (STP) and Market Making.
One of the ways to earn extra profits and revenue is through reverse hedging. This is where STP can take a position opposite a client’s trade to hedge against potential losses. However, this should be used with caution as it can also increase the firm’s risk exposure.
To execute these plans, an STP requires a team of skilled people and in-house plugins and technologies like Liquidity Bridge, which connects multiple liquidity providers to the trading platform simultaneously and offers various execution models. As a prop firm startup, the most efficient way to start is through the STP route, which is simple and efficient. However, as STP mature and become more established, they can further explore market-making and reverse hedging to optimize their trading operations.
Final Thoughts
Launching a prop trading firm will require a combination of human expertise and tech. The margins are high, but building a sustainable prop firm does require infrastructure. The tech above is just a good start, remember. They are just tools. The action of real things only happens when skilled traders and a dedicated STP team will yield these tools.