What It Takes To Trade For a Prop Trading Firm!

This past October, two CMR members took part in a trading competition organized by a prominent prop trading firm. I am happy to report that both members did really well with top 10 performances. They were kind enough to share their experience and lessons learned. I want to sincerely thank both for this information that all traders can benefit from. Both traders preferred to remain anonymous, which we respected. You will see common themes from both traders that should not be surprising, but should also remind you that there is no secret “sauce” to trading and the keys to success are not a secret but very difficult to maintain.

In late 2025, I participated in a futures trading competition hosted by [a national prop trading firm]. The competition lasted from October 1 – November 21, or roughly eight trading weeks. I wound up finishing in the top ten out of 60 participants.

I have been a CMR member for a little under a year. I have been trading futures markets for one year as of November 2025 without any prior trading experience. My career is in the software industry. Many years ago, I derived my income from playing poker.

My trading is performed outside of US market hours and primarily from using daily charts. It is something that I pursue during the nights and weekends. Distance from the market helps me make better decisions.

The learnings from CMR that have influenced my trading are:

• Wait for the market confirmation of your thesis
• Importance of closing price
• Trade your own system and/or process
• Have the discipline to stick to your process
• If the process is your own, it is easier to be disciplined than if it is not

Another benefit of joining CMR is the Discord community and communicating with other traders. Several of us from the CMR Discord who were competing were also regularly communicating together throughout the duration of the competition. Having access to other traders was important to me, especially being a new trader.

When I was playing poker, being around other players who thought about the game and wrote about the game was an important source of my own self-improvement at that time. I have found numerous parallels to playing poker and trading. Being able to frame concepts in trading in a way I had previously internalized was helpful for me.

While I find the CMR service invaluable, I personally do not trade the CMR process, nor do I trade based on the COT data. I am more of a technical trader, but much of the way I think about markets and approach trading has been influenced by Jason and CMR. Trading that utilizes updated COT data would not have been possible during the competition since the government shutdown impacted the CFTC and their weekly COT data release.

My learnings from participating in the competition and around concepts that I understood before the competition, but like with many things, variations of actual experience helps to further solidify the understanding and ultimately mold behavior. The aspect of competition helped bring the following points to the surface and force a deeper level of introspection for me:

1. Fewer positions are preferred to more positions. It is easier for me to manage 1, 2, or 3 positions than 5 or 6 positions. It also forces me to think through a position before I put it on because there is an opportunity cost of not taking a different trade. That opportunity cost is always there, but if you can just add on one more position, it creates the illusion that the opportunity cost is not there. As someone who tends to be more inclined to take on a trade than to pass on a trade, this is a healthy compensating correction for my behavior. Doing nothing, or no trade, is often the best trade.

2. Concentrate into one asset if similar assets are setting up and try to pick the leader. Time will reveal if I picked the wrong asset in terms of the leader, but that is secondary to the concentration. If I am not sure of the leader, maybe I pick the market with more trading volume or less volatility. I learned this during the competition by going long on both corn and soybeans. Both markets were breaking out, but beans appeared to have more strength behind it with a cleaner breakout. I wound up closing out the corn position and allocating the additional risk into beans. Beans was the better performer, but even if it was not, I understand now that I prefer to manage only one position in an asset class at a given time. I had previously preferred to have positions straddling both markets and split my risk between the two. My intention was to lower my variance, but now I believe I can do a better job at achieving lower variance by concentrating on the risk of a single position.

3. I was not mentally prepared for the increase in size and how that changes the absolute number in PnL swings. I had one mistake in particular where I exited a trade prematurely because of the PnL number on that trade. The trade wound up performing well and even surpassing my initial exit price. I had the same trade on at the same time in my cash account and did not exit there.

This is obvious, and something I knew going into the competition, but nonetheless I wasn’t mentally prepared for it and acted emotionally instead of following my plan. What would I do differently next time? Two months before the competition, start copy trading my cash account trades in a paper trading account with a size similar to what I plan on using in the competition so I can get used to what the PnL swings will look like in an absolute Dollar sense.

The majority of the time in my cash account I have trade and account PnL turned off because for my process that information is only noise and does nothing to aid in my decision making. The only time this information is important to my process is when I size for risk when planning a potential trade.

4. The competition added a level of focus and intention that I realized was missing in my trading. This is a little twisted since I was dealing with paper/sim trading on one hand, and real cash on the other. I noticed there were trades that I was willing to take in my cash account and not in the competition. This was a leak in the bucket. I needed the pressure of the competition to force it into my consciousness.

In poker, I avoided marginal hands in marginal positions unless I had control of the situation. Avoiding marginal decisions that compound into even more difficult decisions is almost always a good idea in poker, even more so as a novice who is just learning the game. I was not applying this thinking to my trading up until that point. When I am placing a bet, be it at the poker table or in the market, I want as many probabilities in my favor as I can get. That starts with avoiding marginal situations altogether.

5. Size of the trading universe – in the competition, we were limited to CME contracts and did not have access to all of the markets. Since I do not typically have an abundance of setups, my preference is to have a larger universe of which to look for opportunities. That said, much like managing 3 positions is preferable to 6 for me, I’m thinking about the merits of a smaller universe. Is it better to have a smaller universe and sit on your hands most of the time waiting for that perfect setup? I need to think about this some more.

On the mechanics of how the competition was run, we had a self-enforced daily stop that was based on intraday PnL swings. Cumulative PnL did not matter. In my personal trading, the charts tell me when to get out, not the PnL. If I am doing what I need to do, the PnL part takes care of itself.

As someone who was holding positions over several days and some for several weeks, I had to be aware of not triggering the daily stop and liquidating all of my holdings. This in turn caused me to be less aggressive in sizing my positions. Having to liquidate everything, including my profitable positions, because one initial position went against me would have been a disaster. Having a stop based on individual positions, a longer time frame stop, or an allowance for PnL when holding positions on a longer time frame would have made this easier to navigate, however the competition was geared towards shorter-term trading and this daily stop makes sense in that situation.

My first trade taken in the competition was long Bitcoin. My last trade exiting the competition was short bitcoin. When October started, I was thinking, how lucky am I, that this is starting right when Bitcoin is finally having its big breakout. Little did I know that by the end I would be pulling my PnL from the other side of the trade. The lesson there is to be flexible and adjust to what the market is showing you. It’s not about being right, it’s about making money. Where have I heard that before?

In conclusion, I would like to thank the folks at the prop firm for all of their hard work in organizing and executing a competition of this size. This took a significant amount of their time and effort to pull off. They were responsive to any reported challenges along the way and did their best to make things right when needed. Also, a big thank you to the CMR Discord, Jason & the CMR Team for all of the work they do to make CMR and the CMR community possible.

These are my top five lessons learned from participating in the trading competition:

1. Trading is hard. Although the 60 contestants are selected out of 300+ applicants, the final results resemble real life trading: most people lose money; several are flat; and a few at the top account for the majority of profits. It is exactly the same pattern in multi-strategy hedge funds, prop trading firms, funded trading websites, retail brokerages. This is cold data. This is hard truth: trading is hard. Fxxking hard.
2. Stay disciplined. Yes, it’s such a cliche, but that’s the only thing common across the top 10 traders, who have vast different strategies/techniques/time frames, but they all made it to the top, for they stayed disciplined to their own methods.
3. Daily stop loss rule. Such short-term oriented risk management rule does not suit for traders who usually have a time frame over 3 to 5 days and longer. [If you join a similar competition] If that’s how you trade, I’d advise modifying your strategy towards shorter time frame, or using a smaller size.
4. Move on quickly from technical issues. Unfortunately, there were technical issues of the trading software, i.e. missing orders, wrong positions. If that happens to you, escalate, but more importantly, move on and don’t let it disturb your mindset. It feels “unfair”, “not my fault”, “stupid system”, yes, understandably, but the longer you stay in that mood, the worse it gets.
5. Make friends. The best thing I got out of the competition is the traders I met. Talk to people, discuss trade ideas, make fun of each other (when appropriate), even keep contact after the competition. It’s very rewarding.