Glossary

Prop firm and funded account terms, defined

Short definitions of the words you meet on the rules page, in the dashboard and in every prop firm conversation, each with the number or behaviour that applies at VaultX.

Funded account: A trading account whose capital belongs to a prop firm, not the trader. You pass an evaluation, then trade the firm's account and keep a share of the profit (80% at VaultX). Losses beyond the rules end the account, never your own money.; See also:Prop firm Evaluation (challenge)Profit split
Prop firm: Short for proprietary trading firm: a company that gives traders access to its own capital in exchange for a share of profits. Retail prop firms like VaultX screen traders with a paid evaluation instead of a job interview.; See also:Funded account Evaluation (challenge)
Evaluation (challenge): The paid test before funding. You trade a simulated account to a profit target while staying inside a daily loss limit and a maximum loss limit, over one or more phases. VaultX runs 3 Step, 2 Step and 1 Step evaluations with no time limit.; See also:Phase Profit target 1 Step, 2 Step, 3 Step
Phase: One stage of a multi-stage evaluation, each with its own profit target. A 2 Step evaluation has two phases; a 3 Step has three. Passing every phase earns the funded account.; See also:Evaluation (challenge)1 Step, 2 Step, 3 Step
Profit target: The gain, as a percentage of the starting balance, that closes a phase. Targets at VaultX range from 4% on the first phase of 3 Step to 12% on 1 Step; they are measured on closed trades.; See also:Phase Closed trade
Daily loss limit (daily drawdown): The most an account may lose in one trading day, measured from that day's starting balance or equity. Touching it fails the evaluation. VaultX daily limits run from 3% to 5% depending on the route; funded accounts have no daily limit.; See also:Maximum loss (max drawdown)Breach
Maximum loss (max drawdown): The most an account may lose overall from its starting balance. At VaultX it is static (6% to 10% of the evaluation size, by route) and does not trail your profits. On the funded account the limit is a share of the funded size, 35% to 80%.; See also:Static drawdown Trailing drawdown
Static drawdown: A maximum loss limit fixed to the starting balance. If a $100,000 evaluation allows 10%, the floor stays at $90,000 no matter how high equity climbs. Simpler to trade around than a trailing limit.; See also:Trailing drawdown Maximum loss (max drawdown)
Trailing drawdown: A maximum loss limit that moves up with your highest balance or equity, so profits raise the floor. Common at other firms; VaultX uses static limits on every route.; See also:Static drawdown
Breach: A rule violation that ends the account: a loss limit touched, or a prohibited practice found in review. VaultX records the exact trade or tick behind every breach and closes any open positions on the account.; See also:Daily loss limit (daily drawdown)Maximum loss (max drawdown)
Profitable day: A trading day that closes with a net gain. Most VaultX routes require five profitable days during the evaluation (3 Step asks for two, two and three per phase). There is no minimum number of days otherwise and no time limit.; See also:Minimum trading days
Minimum trading days: A rule that stops one lucky trade from passing an evaluation: a set number of days with activity or with profit before a phase can close. At this firm it is expressed as profitable days.; See also:Profitable day Consistency rule
Consistency rule: A cap on how much of your total profit may come from a single day or trade. Some VaultX routes advertise no consistency rule; where one applies it is listed on the rules page.; See also:Minimum trading days
Profit split: The share of funded-account profit paid to the trader. VaultX pays 80% on every evaluation route; the firm keeps the rest and carries the losses.; See also:Payout Funded account
Payout: A withdrawal of your profit share from a funded account. VaultX payouts can be requested multiple daily, with a $20 minimum, after identity verification.; See also:Profit split KYC (identity verification)
Scaling plan: A schedule that grows a funded account as the trader hits milestones. VaultX funded accounts start at 10% of the evaluation size and can grow up to eight times.; See also:Funded account
1 Step, 2 Step, 3 Step: The number of phases in an evaluation. 1 Step has one target (12% at VaultX) with tighter loss limits; 2 Step splits the work into two targets; 3 Step spreads it over three smaller targets with the most funded drawdown.; See also:Phase Evaluation (challenge)
Instant funding (direct funding): A funded account bought outright, with no evaluation, usually at a higher fee and with stricter rules. VaultX lists this as VaultX Direct; it is not on sale yet.; See also:Evaluation (challenge)
KYC (identity verification): Know Your Customer: proving who you are with a government ID and a liveness selfie before funding and payouts. VaultX checks take about 24 hours.; See also:Payout
Simulated (demo) account: An account with live prices but no real orders at a broker. Every evaluation is simulated; the firm says so plainly. What matters is that the rules and the data feed are the same ones real accounts see.; See also:Broker-backed funded account
Broker-backed funded account: A funded account whose trades are mirrored to a brokerage account the firm holds, so payouts come from trading results rather than only from other traders' fees. VaultX calls its funded stage VaultX Live.; See also:Simulated (demo) account Funded account
Closed trade: A position that has been exited. Targets are measured on closed trades, so an open position in profit does not pass a phase until it is closed.; See also:Profit target
Equity vs balance: Balance is the account value from closed trades only; equity adds the floating profit or loss of open positions. Loss limits are checked on equity, so an open loser can breach a limit before it is closed.; See also:Daily loss limit (daily drawdown)
Leverage: Borrowed exposure: 1:100 leverage lets $1,000 of margin control $100,000 of position. Evaluation accounts come with a fixed leverage per instrument group; higher leverage means a smaller move hits a loss limit.; See also:Margin, margin call, stop out
Margin, margin call, stop out: Margin is the collateral a position locks up. A margin call warns that equity is near the required margin; a stop out closes positions when it falls below. On a prop account the loss limits usually hit long before the stop out.; See also:Leverage Equity vs balance
Lot: The unit of position size. One standard lot is 100,000 units of the base currency in forex; most prop traders size in fractions of a lot so a stop loss costs a known share of the daily limit.; See also:Risk per trade
Risk per trade: The amount lost if the stop loss is hit, usually a percentage of the account. Funded traders commonly risk 0.25% to 1% per trade so that several losses in a row stay inside the daily limit.; See also:Daily loss limit (daily drawdown)Lot
News trading: Holding or opening positions around scheduled high-impact releases. Some firms forbid it on funded accounts; check the rules page for the route you trade.; See also:Evaluation (challenge)
Expert advisor (EA): An automated strategy running inside MetaTrader 5. Firms allow EAs that are your own and forbid copying trades between accounts you do not own, latency arbitrage and tick scalping of bad prices; read the prohibited-practices list before switching one on.; See also:Copy trading
Copy trading: Replicating trades from one account to another. Copying between your own accounts is normally allowed; copying another person's signals into a funded account usually is not, because the firm funds the trader, not the signal.; See also:Expert advisor (EA)
MetaTrader 5 (MT5): The trading platform VaultX issues logins for: desktop, web and mobile apps that connect to the same server. Your login, server name and trading password arrive by email within minutes of payment.; See also:Expert advisor (EA)
Spread and swap: Spread is the gap between bid and ask, paid on every trade; swap is the overnight financing charge on positions held past the daily rollover. Both reduce the profit counted toward a target.; See also:Closed trade

The numbers behind these terms live on the rules page; the guides show them in use.

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