Scaling Plan

A structured path that increases the trader's account size after hitting performance milestones — more capital, often with improved profit splits.

Definition

A scaling plan is a firm's formalized path for growing a trader's funded account size over time. The trader qualifies for a larger account after meeting performance targets — typically a combination of consistent monthly profit, a minimum number of profitable months, and no drawdown breaches. Scaling usually includes both account-size increases (e.g., $100K → $200K → $400K) and profit-split improvements (e.g., 80% → 85% → 90%). Not all firms offer scaling; those that do usually require 3-6 months of performance before the first scale-up.

Example

A trader on a $100K FTMO account hits 10% profit in month 1 and 4% in month 2 without any drawdown breaches. FTMO's scaling plan doubles the account to $200K (with an 80% profit split unchanged), then triples to $600K after four consistently profitable months. The trader's per-month upside roughly 6x's over the first four months — but only if they maintain the minimum monthly profit the scaling plan requires, which can force more conservative trading.

Why It Matters

Scaling plans are a significant revenue multiplier for profitable traders — but the performance thresholds also create pressure that can push traders into suboptimal decisions (over-trading in a slow month to hit the scaling profit minimum). The upside is real for consistent traders; the downside is that the structure can distort risk behavior in traders who are not yet consistent. FTMO, The 5ers, and Topstep are notable examples of firms with well-defined scaling paths.

Firms Using This (3)

FTMO The 5%ers Topstep

Related Terms

Funded Account

The trading account granted after passing the evaluation — almost always simulated, with real profit splits and real payouts.

Profit Split

The percentage of trading profits a funded trader keeps, with the remainder going to the prop firm.

Evaluation Challenge

The paid skills test a trader must pass to earn a funded account — typically one, two, or three phases with profit targets and drawdown rules.

Fee Refundable

Whether the challenge fee is refunded on the trader's first payout — a feature that meaningfully changes the effective cost of the challenge.

← All termsLast updated 2026-04-21