What Is The Difference Between Proprietary Trading And Modern Prop Trading?

Modern prop firms and traditional prop firms are two different ways of doing financial trading. Traditional prop firms are like regular offices where traders work together, while modern prop firms let traders work from anywhere in the world using own technology and the internet. The big difference is in where people work.

Traditional prop firms are companies that support their traders. They give traders a base income and sometimes extra bonuses based on how well they do. Traders in these firms usually work in offices in major financial cities. It's often hard for regular traders to get these opportunities, as these firms usually hire graduates or experienced professionals. These firms make money from the trading activities of their traders, like electronic market making and trading in different markets.

The modern prop firm is the current way of doing business online. Traders can work from anywhere in the world without needing a physical office. This became more popular with remote work and the Covid-19 pandemic. In these firms, traders act like freelancers, getting guidelines and money from the firm. They share the profits, giving them flexibility to do their own trading strategies while getting support from the modern prop firm.