What Is an Eval in Trading? A Trader's Guide to Evaluations

You found a prop firm with a funded account that looks promising. Then you hit the word "eval" and the page assumes you already know what that means.

You don't, and that's fine. Most traders encounter the term before anyone bothers to explain it.

So what is an eval in trading?

An eval — short for evaluation — is a test account you trade to prove you can handle real capital before a prop firm hands you a funded account. You're not risking your own money. You're proving you can follow rules, manage risk, and hit a profit target without blowing up the account.

That single idea explains almost everything else about how prop trading works. Here's the full picture.

What Is an Eval in Trading, Exactly?

An eval is a simulated trading account with two requirements: hit a profit target, and don't violate the risk rules while you do it.

The firm isn't watching to see if you're lucky once. It's watching to see if you're disciplined repeatedly. That's the entire point of the structure — separating traders who can manage risk from traders who can't, before any real capital is on the line.

You're trading with live market data and live prices. The capital backing the trade just isn't yours, and it isn't fully real yet either. Think of it as a supervised audition rather than a video game: the conditions are genuine, but the firm hasn't handed over the keys.

The eval meaning in trading is really a test of a trader's skills.

Pass the eval, and you move to a funded trading account. Fail the eval, and you've failed the test and you won't be seeing a performance account in your name.

Most firms will let you reset and try again, usually for a new fee.

Why Prop Firms Use Trading Evaluations at All

A firm offering you tens of thousands of dollars in buying power has a simple problem: it has no idea if you can trade.

The evaluation solves that problem cheaply. Instead of vetting traders through interviews or track records, the firm lets the market do the vetting. You either demonstrate the skills that matter or you don't.

What an evaluation is actually testing:

Every one of those is a proxy for the same underlying question: will this person protect the firm's capital once it's real.

The Two Account Stages: Evaluation and Performance

It helps to think of the journey as two distinct phases with two different rule sets.

Evaluation account. This is the testing phase. You're working toward a profit target while staying inside drawdown limits. The account is simulated — no payouts happen here, because there's nothing real to pay out yet.

Performance account. This is what you earn by passing. The capital is now backing real payouts, and the risk structure typically shifts from a moving drawdown floor to a static one, since the firm no longer needs to test your trajectory — only your ongoing discipline.

At Vanquish Trader, this is a one-step process: pass the evaluation, move directly to a Performance Account, and start requesting payouts. There's no second verification phase standing between you and real capital, which is a meaningful departure from the multi-stage challenges common across the industry.

Drawdown: The Rule That Actually Decides Whether You Pass

Most traders fail an eval on drawdown, not on missing the profit target. If you only learn one mechanic before starting an evaluation, make it this one.

Drawdown is the maximum amount your account can lose before the evaluation ends. But how that limit is calculated varies, and the variation matters more than the headline percentage.

If you want the full mechanics of how a trailing floor behaves as your account grows, the trailing drawdown breakdown walks through it with worked examples.

What Happens After You Pass

Passing the eval isn't the finish line. It's the point where the rules — and the stakes — change.

You move into a funded or Performance account, and the drawdown structure typically becomes static rather than trailing. The pressure to chase a profit target disappears. What replaces it is the discipline to protect a fixed cushion while requesting payouts.

This is also where profit splits start to matter. Across the industry, traders typically keep somewhere between 70% and 90% of what they earn, with the firm retaining the rest as compensation for the capital and risk it's carrying.

Vanquish takes a different position here: traders on a Performance Account keep 100% of their profits, with no split at all.

Your trading profits are yours. Not ours.

How to Approach Your First Eval

A few habits separate traders who pass on the first attempt from traders who don't.

None of this requires a complicated strategy. It requires applying the strategy you already have inside a structure you actually understand.

The Short Version

An eval is the proving ground between you and a funded trading account — a simulated test of profit and risk discipline, not a hurdle designed to trip you up.

Understand your drawdown type, respect the profit target without rushing it, and trade the eval the way you'd trade the funded account that follows. That's really the whole test.