FTMO offers two evaluation paths for forex and CFD traders: the FTMO Challenge: 2-Step (comprising an FTMO Challenge phase followed by a Verification phase) and the newer FTMO Challenge: 1-Step (a single phase with no Verification). Both paths use simulated capital, and every rule that governs them is described by FTMO as a Trading Objective. All objectives must be satisfied at the same time; meeting one target while breaching a loss limit is not sufficient. Once a trader passes the evaluation and completes identity verification, they receive a demo FTMO Account and become eligible to receive real-money rewards based on their simulated profits.
This page covers every target and limit for both paths, explains exactly how the Maximum Daily Loss and the Maximum Loss are calculated on each, notes where rules differ between the Standard and Swing account types, and summarises the restrictions around news trading, overnight positions, expert advisors and account access. All figures come directly from FTMO's official pages, which were checked on 2026-10-02: the Trading Objectives page, the 2-Step Challenge page, the 1-Step Challenge page, the Scaling Plan page, the reward withdrawal FAQ, the news trading FAQ, the overnight positions FAQ, and the Forbidden Trading Practices page.
Quick Reference: Targets and Limits by Path
The table below summarises every numerical objective for both evaluation paths, as published by FTMO. Figures for the FTMO Account phase are included where the rule continues to apply after passing.
| Rule | 2-Step: FTMO Challenge (Phase 1) | 2-Step: Verification (Phase 2) | 2-Step: FTMO Account | 1-Step: FTMO Challenge | 1-Step: FTMO Account |
|---|---|---|---|---|---|
| Profit Target | 10% of Initial Simulated Capital | 5% of Initial Simulated Capital | None | 10% of Initial Simulated Capital | None |
| Maximum Daily Loss | 5% of Initial Simulated Capital | 5% of Initial Simulated Capital | 5% of Initial Simulated Capital | 3% of Initial Simulated Capital | 3% of Initial Simulated Capital |
| Maximum Loss | 10% of Initial Simulated Capital (static) | 10% of Initial Simulated Capital (static) | 10% of Initial Simulated Capital (static) | 10% of Initial Simulated Capital (trailing) | 10% of Initial Simulated Capital (trailing) |
| Minimum Trading Days | 4 days | 4 days | None | None stated | None stated |
| Trading Period | Unlimited | Unlimited | Ongoing | Unlimited | Ongoing |
| Best Day Rule | Not applicable | Not applicable | Not applicable | Best day must not exceed 50% of Positive Days' Profit | Best day must not exceed 50% of Positive Days' Profit |
Profit Targets Explained
The profit target is met when the account balance (with all positions closed) exceeds the Initial Simulated Capital by the required percentage. Open trade profits do not count toward passing; positions must be closed first.
2-Step path
Phase 1 requires a 10% profit target. On a hypothetical $100,000 account, for illustration only, that means reaching a closed balance of $110,000. Phase 2 (Verification) requires a lower 5% profit target, so the same hypothetical account must reach $105,000 with all positions closed. There is no profit target on the subsequent FTMO Account. Details are published on the Trading Objectives page.
1-Step path
There is a single 10% profit target, identical in size to Phase 1 of the 2-Step path. Once passed, there is no profit target on the 1-Step FTMO Account.
How the Maximum Daily Loss is Calculated
The Maximum Daily Loss is one of the two loss rules traders most frequently misunderstand. Understanding whether it is measured on balance or equity, and when it resets, is essential. For a deeper look at the distinction between daily and overall drawdown, the article on daily drawdown vs max drawdown explained for prop traders covers the mechanics in detail. You can also verify your own numbers with a prop firm daily loss calculator.
FTMO measures the Maximum Daily Loss on equity, defined as: Balance plus Open Positions P/L, adjusted for swaps and commissions. If equity drops below the Maximum Daily Loss Limit at any point during the day, the rule is violated, even if the account recovers before market close.
2-Step path: 5% daily loss, balance-based reset
The Maximum Daily Loss Amount is 5% of the Initial Simulated Capital. The limit for each day is calculated at 00:00 CE(S)T as:
- Account balance recorded at 00:00 CE(S)T of the current day, minus 5% of Initial Simulated Capital.
On the first trading day, the balance used is the Initial Simulated Capital itself. The limit holds for the full calendar day and is recalculated again at the next midnight CE(S)T. On a hypothetical $100,000 account (for illustration only): if the balance at midnight between Day 1 and Day 2 is $102,000, the Day 2 limit is $102,000 minus $5,000, which equals $97,000. The limit moves with the daily closing balance. This rule applies across both evaluation phases and continues on the FTMO Account.
1-Step path: 3% daily loss, same reset mechanism
The Maximum Daily Loss Amount is tighter at 3% of the Initial Simulated Capital. The reset mechanism is identical: the limit is recalculated at 00:00 CE(S)T using the closing balance of the previous day. On a hypothetical $100,000 account (for illustration only): Day 1 limit is $100,000 minus $3,000, equal to $97,000. If the balance rises to $102,000 by the end of Day 1, the Day 2 limit becomes $102,000 minus $3,000, equal to $99,000. This rule applies to the 1-Step challenge phase and continues on the 1-Step FTMO Account.
How the Maximum Loss (Overall Drawdown) is Calculated
Both paths share the same Maximum Loss Amount of 10% of the Initial Simulated Capital, but the mechanism differs fundamentally between the two paths.
2-Step path: static limit
On the 2-Step path, the Maximum Loss Limit is static. It is calculated once as Initial Simulated Capital minus 10%, and it never moves. On a hypothetical $100,000 account (for illustration only), the limit is permanently $90,000, regardless of how much profit is made. Because the floor does not rise with profits, there is no trailing element. This applies to both evaluation phases and the FTMO Account.
1-Step path: end-of-day trailing limit
On the 1-Step path, the Maximum Loss Limit is an end-of-day trailing limit. It is recalculated at 00:00 CE(S)T each day as the highest account balance achieved at midnight on any preceding trading day (or the Initial Simulated Capital if that is higher), minus 10% of the Initial Simulated Capital. Crucially, the limit can only move upward, never downward. On a hypothetical $100,000 account (for illustration only): if the balance reaches $104,000 at midnight, the limit rises to $94,000. If the next night's balance falls back to $103,000, the limit stays at $94,000 because it is anchored to the highest historical midnight balance. The FTMO Account page notes that when a reward is withdrawn and a new FTMO Account is issued, the Maximum Loss Limit fully resets to 90% of the new Initial Simulated Capital.
Minimum Trading Days and Time Limits
A Trading Day is defined by FTMO as any day, measured from 00:00:00 to 23:59:59 CE(S)T, during which at least one position is opened.
On the 2-Step path, a minimum of 4 Trading Days is required in each phase (FTMO Challenge and Verification). There is no minimum trading day requirement on the 2-Step FTMO Account.
On the 1-Step path, the official pages checked do not state a minimum trading day requirement for the challenge phase. The trading period for both paths is unlimited, meaning there is no deadline by which the profit target must be reached.
Consistency Rules: the Best Day Rule (1-Step Only)
The Best Day Rule applies only to the 1-Step path (both the challenge phase and the FTMO Account). It does not apply to the 2-Step path. For a broader explanation of how consistency rules work across the prop firm industry, the article on prop firm consistency rule explained for traders is a useful reference.
The rule requires that a trader's single most profitable day (the Best Day) must not represent more than 50% of the total Positive Days' Profit. Positive Days' Profit is the sum of closed profit and loss from all days that ended in profit. Exceeding the 50% threshold is not itself a breach; the trader must simply continue generating additional profit on other days until the Best Day falls to 50% or below. The Best Day is assessed at 00:00 CE(S)T each day, or at the moment all other Trading Objectives are fulfilled on the 1-Step challenge.
Trading Restrictions: News, Overnight Positions and Forbidden Practices
News trading
During the Evaluation Process (both phases of the 2-Step path and the single phase of the 1-Step path), there are no restrictions on news trading, regardless of whether the account is Standard or Swing type. Once a trader reaches the FTMO Account stage, restrictions apply only to the Standard account type. Swing accounts have no news trading restrictions at any stage.
On a Standard FTMO Account, trades on targeted instruments may not be opened or closed within a window starting 2 minutes before and ending 2 minutes after selected macroeconomic releases. Positions already open more than 2 minutes before the restricted window may be held through it, but if a Stop Loss or Take Profit is triggered inside the window, that also constitutes a breach. A full table of restricted events and affected instruments is published on the news trading FAQ page. For context on how news rules compare across the prop firm space, the guide on news trading rules in prop firms sets out the common approaches.
Overnight and weekend positions
During the Evaluation Process, no restrictions apply to holding positions overnight or over the weekend, regardless of account type. On a Standard FTMO Account, traders must close positions before the weekend or before any market break lasting more than 2 hours. Swing accounts are exempt from this requirement at all stages. Details are on the overnight positions FAQ page.
Account type availability
The Swing account type is not available for the FTMO Challenge: 1-Step. It is available for the 2-Step path.
Forbidden practices
FTMO's Forbidden Trading Practices page lists the following prohibited behaviours: exploiting price display errors or data feed delays; performing simultaneous opposite positions across connected or multiple accounts for manipulative purposes (opposite positions on a single account are not prohibited on their own); using software, artificial intelligence or ultra-high-speed tools that give an unfair advantage; gap trading around major news events or within two hours of a market closing for two or more hours; automated robots or Expert Advisors that cause more than 2,000 server requests per day; and strategies that artificially distribute profit across multiple days to circumvent the Best Day Rule, such as hedging or holding opposing positions on the same or highly correlated instruments. Risk management rules prohibit opening substantially larger or smaller position sizes or numbers of positions compared to a trader's other trades, and repeated activity that increases cumulative exposure on specific symbols. Proper position sizing is covered in the article on lot sizing for prop firm accounts, and the prop firm lot size calculator can assist with pre-trade checks.
Who May Access and Trade the Account
FTMO's Forbidden Trading Practices page states that the services are intended for personal use only. Specifically: a trader must not allow any third party to access or use their FTMO Account or challenge account, nor engage any third party to perform simulated trades for them or in coordination with them. A trader must not access or trade on any other person's account. If the account holder is a legal entity, access may not be shared with employees except members of top management or another body with the highest executive authority.
Payouts, Profit Split and Scaling
Reward requests can be submitted from the 14th day after the first trade on the account, with all positions closed. FTMO reviews submissions within 1 to 2 business days, and once approved the reward is typically sent within a further 1 to 2 business days after the invoice is approved.
On the 1-Step path, traders receive 90% of simulated profits. Rewards cannot be left on the account to grow the balance. On the 2-Step path, the starting profit split is 80%, rising to 90% when Scaling Plan or Premium Programme conditions are met. Traders on the 2-Step path may also roll over rewards to the account to build a larger balance and drawdown buffer; the minimum rollover amount is stated as 20 units in the relevant currency (EUR, USD, GBP, AUD, CAD, CHF) or 500 CZK.
The Scaling Plan allows account growth of 25% every 4 months, up to $2,000,000. Requirements, as stated on the Scaling Plan page, are: at least 4 months of trading as an FTMO Trader under the same order, at least 10% net simulated profit above the starting balance generated within the prior 4 months, at least 2 processed rewards within that same 4-month period, and a positive account balance at the time of scale-up. The page marks its 90% share of simulated profits as valid for the 2-Step path only, and the official pages checked do not state whether the Scaling Plan is open to traders who qualified through the 1-Step.
Official Sources
Rules verified on October 2, 2026 against FTMO's official pages below. Rules change: the firm's own pages always prevail. The rules of other firms are in our prop firm rules hub.
- Trading Objectives | FTMO.com
- FTMO Challenge: 2-Step | FTMO.com
- FTMO Challenge: 1-Step | FTMO.com
- Scaling and Reward Growth Plan | FTMO.com
- How do I withdraw my reward? | FTMO.com
- Can I trade news? | FTMO.com
- Do I have to close my positions overnight or before the weekend? | FTMO.com
- Forbidden Trading Practices | FTMO.com
Disclaimer: Fast Funded is an independent service and is not affiliated with, endorsed by, or connected to any prop firm mentioned in this article. Rules and conditions change: always verify current terms on the firm's official website.