Unbiased Review of Next Step Funded Prop Firm
In this article, you'll find an unbiased and honest review of Next Step Funded, a prop firm. This review covers the good, the bad, and the ugly aspects. I haven't been paid to write this, and there are no affiliate links to promote.
Why should you trust my perspective? Well, I've been involved in the prop trading industry, having owned my own firm. I've assisted hundreds of individuals in becoming funded prop traders. With extensive experience in the field, I regularly test various prop firms.
Let's delve into a comprehensive rating of Next Step Funded on a scale of 1 to 10 across different categories:
- Trading Challenge: Rating: __/10
- Company Overview: Rating: __/10
- Unique Perks: Rating: __/10
- Trading Conditions: Rating: __/10
First, let's assess their trading challenge difficulty, scoring them from 1 to 10 based on how easy or difficult it is to pass.
One-Step Evaluation Criteria and Rules
Let's start by examining Next Step Funded's one-step evaluation. This evaluation involves a minimum of 3 trading days and a maximum of 60 trading days.
One Step Challenge
| Capital | $15,000 | $25,000 | $50,000 | $100,000 | $200,000 |
|---|---|---|---|---|---|
| Targets | 10% | 10% | 10% | 10% | 10% |
| Profit Split | Up to 80% | Up to 80% | Up to 80% | Up to 80% | Up to 80% |
| Weekend Holding | Allowed | Allowed | Allowed | Allowed | Allowed |
| Minimum Trading Days | 3 days | 3 days | 3 days | 3 days | 3 days |
| Time Limit | 60 Days | 60 Days | 60 Days | 60 Days | 60 Days |
| Daily Starting Drawdown | 5% | 5% | 5% | 5% | 5% |
| Max Drawdown | 12% | 12% | 12% | 12% | 12% |
| Leverage | 1:30 | 1:30 | 1:30 | 1:30 | 1:30 |
| Refundable Fee | 125$ | 179$ | 359$ | 602$ | 1205$ |
Here are the key criteria for their one-step evaluation:
- Minimum Trading Days: 3 days
- Maximum Trading Days: 60 days
- Daily Drawdown: 5%
- Maximum Drawdown: 12%
- Profit Target: 10%
Notably, their maximum drawdown of 12% is relatively high compared to industry standards. Some unique aspects of this prop firm's one-step challenge include:
- High Frequency Trading: Not allowed
- Lot Size Consistency Rule: Not specified
- Profit Cap: Upon becoming a funded trader, your earnings are capped at 5% of your 80% split within the first two months.
- 50% Rule: Within the first two months, no single trade can account for more than 50% of your profit. This rule ensures diversification.
- Stop Loss and Take Profit: Not required
- News Trading: Allowed
- Refund: Available for this one-step challenge
The price for the one-step challenge on a $100,000 account is $602. If you manage to meet the challenge rules without breaking them, you are eligible for one free repeat. The maximum allocation per person is $600,000.
Two-Step Evaluation Criteria and Concerns
Now, let's shift our focus to the two-step challenge, which costs about $503 for a $100,000 account, a price that aligns with industry standards.
Two Step Challenge
| Capital | $15,000 | $25,000 | $50,000 | $100,000 | $200,000 |
|---|---|---|---|---|---|
| Targets | Phase I- Propfit Target = 10%, Phase II- Profit Target = 5% | Phase I- Propfit Target = 10%, Phase II- Profit Target = 5% | Phase I- Propfit Target = 10%, Phase II- Profit Target = 5% | Phase I- Propfit Target = 10%, Phase II- Profit Target = 5% | Phase I- Propfit Target = 10%, Phase II- Profit Target = 5% |
| Profit Split | Up to 80% | Up to 80% | Up to 80% | Up to 80% | Up to 80% |
| Weekend Holding | Allowed | Allowed | Allowed | Allowed | Allowed |
| Minimum Trading Days | 5 days | 5 days | 5 days | 5 days | 5 days |
| Time Limit | Phase 1 = 30 Days, Phase 2 = 60 Days | Phase 1 = 30 Days, Phase 2 = 60 Days | Phase 1 = 30 Days, Phase 2 = 60 Days | Phase 1 = 30 Days, Phase 2 = 60 Days | Phase 1 = 30 Days, Phase 2 = 60 Days |
| Daily Starting Drawdown | 5% | 5% | 5% | 5% | 5% |
| Max Drawdown | 12% | 12% | 12% | 12% | 12% |
| Leverage | 1:30 | 1:30 | 1:30 | 1:30 | 1:30 |
| Refundable Fee | 98$ | 152$ | 305$ | 503$ | 998$ |
Here are the criteria for their two-step challenge:
- Phase 1:
- Minimum Trading Days: 5 days
- Maximum Trading Days: 30 days
- Maximum Daily Drawdown: 5%
- Maximum Overall Drawdown: 12%
- Profit Target: 10%
- Phase 2:
- Maximum Trading Days: 60 days
- Profit Target: 5%
An interesting feature of this prop firm is that they allow High Frequency Trading (HFT) in the first two phases of their challenge. However, once you have a funded account, HFT is no longer permitted. It's worth noting that HFT is often associated with certain risks, as it can be used to exploit market inefficiencies.
Prop firms that allow HFT may have a challenging track record when it comes to paying out traders, and this is due to some unique rules designed to make payouts more difficult:
- Lot Size Consistency Rule: They have a rule regarding lot size consistency. Consult the FAQ for details, but in essence, it prevents traders from using varying lot sizes, ensuring consistency.
- 5% Profit Cap: For the first three months, traders cannot earn more than 5% profit per month.
- 50% Rule: No single trade can account for more than 50% of the profit made in the first two months.
These unusual rules are likely in place to offset the fact that they allow HFT trading, which can lead to more traders passing the challenge. However, it also makes it harder for traders to receive payouts once they become funded.
In summary, I would only recommend this prop firm if you intend to use an HFT service or trading system to pass the first two phases and are willing to accept the more challenging conditions for receiving payouts. The absence of a refund policy may be attributed to the HFT allowance.
Overall, I would rate their challenge criteria a 4 out of 10. The presence of these unconventional rules makes it difficult to obtain a payout, and it appears that this prop firm relies on traders who seek to leverage HFT and potentially use less reputable HFT passing services.
Company Reputation and Trustworthiness
Now, let's turn our attention to the company behind Next Step Funded and assess how well it is managed. They provide a chat service, but their claim of typically responding within a few minutes hasn't matched my experience. When I contacted them recently, it took nearly 24 hours to receive a response. They also maintain a Discord channel, but the chat support's performance has been subpar in my experience.
We should also take a close look at their Trustpilot reviews. While they have an overall rating of four stars, a notable red flag is the presence of 24% one-star reviews, a percentage higher than any other prop firm I've reviewed on this channel. This is certainly a concern worth considering.
As for their track record of payout and reliability, I delved into several one-star reviews and discovered multiple complaints about sketchy practices and withheld payouts. This further raises questions about their trustworthiness.
When it comes to the founders of this company, I couldn't find any substantial information about them. This lack of transparency raises concerns, as I believe prop firms willing to put their names and reputations on the line are more accountable.
Regarding their longevity, it appears that Next Step Funded was established at the beginning of 2023, meaning they have been in operation for less than a year.
In my overall assessment of the company, I haven't been impressed by the criteria we use to evaluate prop firms. On a scale of 1 to 10, I would give it a rating of 2.
Unique Perks Offered by Next Step Funded
Now, let's consider the unique perks offered by this particular prop firm. One feature I found appealing is their "Static Drawdown Limit" system. With this system, if you have a $100,000 account, your account equity or balance can't fall below 88% at any time. Unlike other prop firms with variable drawdown features, this is a fixed and reassuring level at 88%, which I consider a noteworthy perk.
Another potential perk for some individuals is the ability to pass using High Frequency Trading systems (HFT). While this might be an attractive feature for some, it's important to note that there are often concerns and controversies associated with high-frequency trading. Prop firms that allow HFT can sometimes engage in questionable practices.
On the whole, when it comes to unique perks, I would rate this prop firm a 6 out of 10. While they have some appealing features, there are also several aspects that make them less attractive compared to other prop firms.
Assessment of Trading Conditions
Now, let's assess the trading conditions provided by Next Step Funded:
- Leverage: 1:30
- Trading Instruments: They offer a wide range of trading instruments, including gold, indices, metals, forex pairs, and cryptocurrencies, covering the majority of options available.
- Broker: They utilize Eightcap as their broker, a choice also made by some other prop firms. You can access detailed information about spreads and view real-time spread data for specific assets on their platform.
- Allowed Trading Tools: Expert Advisors (EAs) and indicators are allowed.
- Prohibited Trading Practices: They do not permit reverse arbitrage, hedge arbitrage, latency arbitrage, tick scalping, or copy trades from other traders. It's worth noting that high-frequency trading is allowed, which may raise concerns.
- Trading During News Events: You are allowed to hold trades through news events and over the weekend.
- Inactivity Rule: They have an inactivity rule, meaning if you haven't traded within 30 days, you may forfeit the account.
In an overall evaluation of their trading conditions, I would give them a rating of 6 out of 10. While they offer a variety of trading instruments and leverage, the allowance of high-frequency trading and the associated restrictions may raise concerns for some traders.
Final Conclusion: Overall Evaluation and Recommendation
Let's wrap up with my final conclusion. After evaluating Next Step Funded in various categories:
- Challenge Criteria: Rated 4 out of 10
- Company Overview: Rated 3 out of 10
- Unique Perks: Rated 6 out of 10
- Trading Conditions: Rated 6 out of 10
These ratings lead to a cumulative score of approximately 4.8. In summary, if you are specifically interested in using high-frequency trading systems, this prop firm might be an option worth considering. However, for the majority of traders, it may be advisable to explore alternative prop firms.