Prop Trading vs. Retail Trading: Which Path Is Right for You in 2025?
In the ever-evolving world of financial markets, traders face an important decision early in their journey: should they pursue proprietary trading (prop trading) or retail trading?
Both paths offer unique opportunities, distinct challenges, and vastly different environments. At Hive PT, we’ve seen firsthand how this choice can shape a trader's future. Having started as a boutique proprietary trading firm and evolved into an industry leader, our mission has always been to empower traders, through capital, mentorship, and cutting-edge resources.
In this article, we’ll break down the key differences between prop trading and retail trading, explore the pros and cons of each, and help you identify which route may align best with your goals, trading style, and resources.
Understanding the Basics
Before diving into the comparison, let’s define each model clearly:
What is Retail Trading?
Retail trading refers to individuals trading financial instruments, such as stocks, forex, crypto, or options, using their personal capital, often through online brokers. These traders operate independently, managing their own risk, strategy, and psychology without the backing or oversight of a firm.
Key characteristics of retail trading:
Self-funded accounts
Independent decision-making
Access to public trading platforms (e.g., MetaTrader, TradingView, ThinkorSwim)
Limited leverage (depending on region and regulations)
What is Proprietary Trading (PROP trading)?
Proprietary trading involves trading with a firm’s capital, not your own. At a prop firm like Hive PT, traders are given access to significant funds after demonstrating their skill and discipline. In return, profits are split between the trader and the firm according to a pre-agreed structure.
Key characteristics of prop trading:
Traders use the firm’s capital
Access to training, coaching, and risk management
Defined evaluation and funding processes
Shared profits (often 70-90% in favor of the trader)
Capital: The First Big Divider
One of the most obvious differences lies in the access to capital.
Retail Trading:
If you’re trading independently, you’re limited to your personal savings or money you’re willing to risk. This can cap your potential returns, especially if you're starting with a small account. Compounding a $1,000 account, even with consistent profits, takes time, patience, and strict discipline.
Prop Trading:
With a prop firm, you're provided with larger account sizes, often $25,000, $100,000, or more. At Hive PT, our traders undergo an evaluation phase, and once they prove their strategy and risk control, they’re eligible for fully funded accounts. This allows traders to leverage their skills without putting their own capital at risk.
Winner: Prop trading gives you the upper hand in capital availability.
Risk and Responsibility
Retail Trading:
As a retail trader, you shoulder 100% of the risk. Every dollar you lose is yours. There's no buffer, no fallback. While this promotes accountability, it can also induce stress, especially for beginners or those under financial pressure.
Prop Trading:
In a prop trading environment, the firm assumes the capital risk. If a funded trader at Hive PT has a losing streak or hits a drawdown limit, the firm absorbs the loss, not the trader. This removes emotional pressure and allows traders to focus on execution and improvement.
Winner: Prop trading offers lower personal financial risk.
Learning Curve and Support:
Retail Trading:
Retail traders often go it alone. While there’s an ocean of free content online, YouTube, Discords, and Reddit, the quality and consistency of education varies wildly. Mentorship is hard to come by, and traders may fall into bad habits or hop between strategies without proper guidance.
Prop Trading:
Most reputable prop firms (like Hive PT) provide structured education, feedback, and coaching. We believe in developing well-rounded traders through performance analytics, one-on-one mentorship, and data-driven feedback. You’re not just trading; you're evolving.
Winner: Prop trading provides a more robust learning environment.
Freedom vs. Structure:
Retail Trading:
Retail traders enjoy total freedom and autonomy. You set your hours, choose your assets, build your own strategy, and have no one to answer to. This independence is appealing to entrepreneurial spirits and creatives.
However, freedom without structure can be a double-edged sword—discipline is non-negotiable in retail trading.
Prop Trading:
Prop trading typically includes structured evaluations and guidelines around risk limits, drawdowns, and profit targets. While some may view these as restrictions, they’re frameworks for sustainable trading. At Hive PT, we’ve seen countless traders flourish once they embrace the structure and accountability we provide.
Winner: Retail for independence, Prop for discipline and growth
Profit Potential: This is where things get interesting.
Retail Trading:
Your profit potential is limited only by your account size and skill. While it’s possible to grow a small account into a large one, doing so requires time, consistency, and compounded returns. Big wins are possible, but rare, and often unsustainable without proper capital and risk management.
Prop Trading:
With a prop firm, you’re instantly equipped with more firepower. Imagine executing a winning strategy on a $100,000 account versus a $1,000 one. That difference compounds fast. Hive PT, for example, offers scalable capital increases as traders prove consistency, opening the door to real six-figure trading careers.
Winner: Prop trading offers faster scaling and higher potential profits.
Costs and Fees
Retail Trading:
You’re responsible for all costs—broker fees, platform subscriptions, data feeds, and any losses incurred. Some platforms also require a minimum balance to access premium features.
Prop Trading:
Prop firms usually charge an evaluation or challenge fee to assess traders before funding. At Hive PT, this is a one-time, transparent cost, often less than what you’d lose learning on your own with personal funds. After that, we cover all operational costs, so traders can focus on performance.
Winner: Depends on your budget and experience level and, Who Should Choose What.
Let’s simplify things based on different trader profiles.
Choose Retail Trading if you:
Prefer complete independence
Have your own capital and are comfortable risking it
Already have a proven strategy and experience
Enjoy self-paced learning and exploration
Choose Prop Trading if you:
Want to trade with significant capital without risking your own
Value mentorship, structure, and feedback
Are looking to scale quickly and professionally
Thrive in goal-oriented, performance-driven environments
Hive PT’s Perspective: Why More Traders Are Going Prop
At Hive PT, we’ve watched the industry shift dramatically over the last few years. More talented retail traders are turning to prop firms—not out of desperation, but out of ambition. They’re seeking:
Greater capital access
Professional-grade tools
Expert mentorship
A community of serious traders
Our firm started as a small group of passionate traders who believed in potential over pedigree. Today, we fund, mentor, and support traders globally—helping them reach levels they couldn’t access on their own.
Whether you’re a seasoned trader or just beginning, prop trading might just be the bridge between where you are and where you want to be.
Final Thoughts
The truth is, there’s no one-size-fits-all answer to the prop vs. retail debate. Both paths offer legitimate opportunities for success. The key is understanding your goals, your risk tolerance, and the type of environment you thrive in.
If you’re disciplined, coachable, and hungry to scale, prop trading offers a faster, safer, and more supported journey to trading success.
And if you’re ready to take that leap, Hive PT is here to support you every step of the way.
📢 Ready to get funded?
Related Articles
The Role of Discipline in Achieving Trading Goals in 2025- Discipline is essential when deciding between prop trading and retail trading.
How to Build a Profitable Backtested Trading Strategy: A Step-by-Step Guide by Hive-PT- A complete guide to creating backtested strategies for prop and retail trading.
How to Choose a Reliable Prop Trading Firm: A Comprehensive Guide- Selecting a firm that aligns with your trading goals, whether prop or retail.
Analyzing Market Trends and Identifying Trading Opportunities- Learn to identify trading opportunities and make data-driven decisions for better results.
