Before a prop firm gives you capital, it wants proof that you can trade profitably while managing risk. Most firms test this with an evaluation, and the two most common formats are the one step and two step challenge. Both lead to a funded account, but they differ in speed, difficulty, cost, and rules. Picking the wrong one can cost you time and fees, so it helps to understand how each works before you buy.
What Is a 1 Step Prop Firm Challenge?
A one step prop firm challenge has a single evaluation phase. You hit one profit target, usually around 8% to 10%, while staying within the daily and maximum loss limits. Once you pass, you move straight to a funded account.
The trade-off is stricter risk rules. Because the firm screens you only once, a one step evaluation prop firm often sets tighter drawdown limits, sometimes trailing ones, and may cap daily losses lower than a two phase model.
What Is a 2 Step Challenge?
A 2 step challenge splits the evaluation into two phases. Phase one usually carries a profit target of about 8% to 10%. Phase two has a lower target, often around 5%. Both phases share the same loss limits, and you must pass both to get funded.
Two phases take longer, but the rules are usually more forgiving. A two step prop firm can allow wider drawdown room because the second phase gives it another check on your consistency.
Key Differences Between One Step and Two Step Challenges
Speed to Funding
A single phase is the faster route. Skilled traders can pass in days or weeks. With two phases, you repeat the process, so funding typically takes longer.
Profit Targets
A one step challenge asks for the full target in one go. The two step model spreads the effort, and the second target is usually easier to reach.
Drawdown Rules
This is often the deciding factor. One step accounts tend to use tighter or trailing drawdowns. Two step accounts more often use a static maximum drawdown, which gives you more room during losing streaks.
Cost
Pricing varies by firm, but one step accounts often cost slightly more for the same account size, because the firm takes on risk after fewer checks.
Profit Split
Many firms offer similar splits for both models, usually starting between 70% and 90%. Some start one step traders on a lower split, so compare the terms carefully.
Pros and Cons of a One Step Funding Prop Firm
Choosing a one step funding prop firm has clear advantages:
- Faster access to a funded account
- Only one profit target to hit
- Less time spent under evaluation pressure
The drawbacks are just as real:
- Tighter drawdown limits leave little room for error
- A single bad session can end the challenge
- Fees can be higher for the same account size
Pros and Cons of a Two Step Prop Firm Challenge
The two step prop firm model suits traders who value flexibility:
- Wider, often static drawdown limits
- A lower profit target in phase two
- More time to show consistent performance
Its downsides include:
- A longer path to funding
- Two phases in which a rule breach can end the attempt
- More patience needed from start to finish
Which Challenge Should You Pick?
Pick a prop firm one step challenge if you already have a tested strategy, a steady win rate, and strong control over daily losses. Scalpers and short-term traders with tight stop losses often do well here, because the fast format rewards precision.
Pick a two step challenge if you prefer swing trading, hold positions longer, or see bigger swings in your equity. The wider drawdown gives your strategy room to work, and the lower second target reduces pressure.
If you are newer to funded trading, the two phase route is usually the safer starting point. It is more forgiving of the small mistakes that come with learning a firm’s rules.
Tips for Passing Either Challenge
Whichever format you choose, a few habits improve your odds:
- Risk a fixed, small percentage per trade, often 0.5% to 1%.
- Know exactly how the drawdown is calculated before you place a trade.
- Avoid chasing the profit target with oversized positions.
- Check the rules on news trading, weekend holds, and minimum trading days.
- Keep a trading journal to spot patterns in your losses.
Final Thoughts
Neither format is better for everyone. The one step route rewards speed and precision, while the two step route rewards patience and consistency. Match the challenge to your trading style, read the full rulebook, and choose a firm with a proven payout record. The right choice is the one whose rules fit how you already trade.
