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How ROI is Calculated (Return Multiple)

This metric is a Return Multiple rather than a traditional ROI percentage. It provides a normalized way to compare the potential of different prop firm plans.

Important Notes

  • This metric should only be used when comparing prop firm plans of the same size and type.
  • The best comparisons are Straight to Funded plans, since all firms offering them provide a listed maximum payout. This ensures a fair and consistent comparison.

Formula

Return Multiple (X) = (Max First Payout × Profit Split) ÷ Plan Price

  • Max First Payout → The maximum amount available on the first payout (capped at $5,000 for normalization).
  • Profit Split → The trader’s share of that payout.
  • Plan Price → The upfront cost of the evaluation or straight to funded plan.

For firms that advertise payouts greater than $5,000 or “uncapped payouts,” this value is normalized at $5,000. Prop firms are not banks — traders should not leave more than $5,000 of available capital in a single account. Pay yourself.

Example

  • Plan Cost = $95
  • Max First Payout = $2,000
  • Profit Split = 90%

Return Multiple = (2000 × 0.90) ÷ 95 = 1800 ÷ 95 ≈ 18.95X

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