In the world of financial markets, access to capital is often the biggest barrier for aspiring traders. While many individuals have the skills, knowledge, and passion to trade profitably, they often lack the large sums of money needed to participate meaningfully in the Forex, stock, futures, or crypto markets. This is where funded accounts come into play. Platforms like Pax Market Funds have introduced opportunities that allow talented traders to access significant trading capital without putting their own savings at risk.
In this blog, we will break down what a funded account is, how it works, the benefits and risks, and why it is becoming one of the most attractive ways to enter professional trading.
Understanding the Concept of a Funded Account
A funded account is a trading account that is financed by a PAX MARKET FUNDS instead of the individual trader. This means that once a trader qualifies, they can access the firm’s money to trade in the markets. The profits generated are shared between the trader and the firm, based on pre-agreed terms.
For example, a trader might receive a $50,000 funded account after passing a trading evaluation. If they earn $5,000 in profits and the profit split is 80/20, the trader keeps $4,000, and the firm keeps $1,000. The beauty of this system is that the trader risks none of their own capital — losses are absorbed by the firm, as long as trading rules are respected.
How Do You Get a Funded Account?
Most firms, including Pax Market Funds, don’t just hand out capital. They need to ensure that traders have the skills and discipline required to manage risk responsibly. Typically, this involves an evaluation process:
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Challenge or Evaluation Phase – Traders are given a demo or simulated account with rules such as profit targets, maximum drawdown limits, and daily loss caps. To pass, they must demonstrate consistent and disciplined trading without breaking any rules.
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Verification Phase – Some firms have a second step to confirm the trader’s performance is not a fluke. This phase usually has more relaxed targets but still enforces strict risk management.
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Live Funded Account – Once the trader passes the evaluation, they are provided with a live account funded by the firm’s capital. They can now trade real markets and share profits.