1-Step vs 2-Step Prop Firm Challenges 2026: Complete Comparison Guide

Table of Contents

• What Are Prop Firm Challenges?
• 1-Step Challenges Explained
• 2-Step Challenges Explained
• Head-to-Head Comparison
• Pass Rate Analysis
• Best 1-Step Prop Firms 2026
• Best 2-Step Prop Firms 2026
• Which Should You Choose?
• Calculator Tools
• FAQs

What Are Prop Firm Challenges?

Prop firm challenges are evaluation programs that test your trading skills before granting access to funded capital. The two dominant models in 2026 are:

• 1-Step Challenges: Single evaluation phase with one profit target
• 2-Step Challenges: Two evaluation phases with graduated targets

1-Step Challenges Explained

How 1-Step Works

In a 1-step evaluation, you have one phase to prove yourself:

1. Hit the profit target (typically 8-10%)
2. Respect drawdown limits (usually 5% daily, 10% max)
3. Trade minimum days (often 3-5 days)
4. Get funded immediately upon passing

Typical 1-Step Requirements

Advantages of 1-Step

Disadvantages of 1-Step

2-Step Challenges Explained

How 2-Step Works

The traditional 2-step evaluation splits the challenge across two phases:

Phase 1:

1. Hit higher profit target (typically 8%)
2. Respect drawdown limits
3. Complete minimum trading days
4. Advance to Phase 2

Phase 2:

1. Hit lower profit target (typically 5%)
2. Continue respecting rules
3. Complete minimum trading days
4. Receive funded account

Typical 2-Step Requirements

Advantages of 2-Step

Disadvantages of 2-Step

Head-to-Head Comparison

Direct Comparison Table

The Math: Expected Value Analysis

Let's compare the expected value assuming:

• 1-Step pass rate: 15%
• 2-Step pass rate: 20%
• 1-Step fee: $499
• 2-Step fee: $399
• Potential funded profit: $5,000/month

1-Step Expected Value:

• EV = (0.15 × $5,000) - (0.85 × $499) = $750 - $424 = $326/attempt

2-Step Expected Value:

• EV = (0.20 × $5,000) - (0.80 × $399) = $1,000 - $319 = $681/attempt

Pass Rate Analysis

Industry Pass Rate Data (2026)

Based on industry research and firm disclosures:

Why 2-Step Has Higher Pass Rates

1. Lower individual targets reduce performance anxiety
2. Phase 2 traders are pre-qualified (already passed phase 1)
3. More time allows recovery from drawdowns
4. Psychological reset between phases helps focus

Why 1-Step Pass Rates Are Lower

1. Higher single target (10% vs 8%+5%)
2. More pressure leads to overtrading
3. Less margin for error in one phase
4. Attracts more aggressive traders who take excessive risk

Best 1-Step Prop Firms 2026

Top Recommendations

FundingPips 1-Step

The most affordable 1-step option with industry-leading payout speed:

• Profit Target: 10%
• Daily Drawdown: 5%
• Max Drawdown: 10%
• Price: From $32 (smallest account)
• Best For: Budget-conscious traders wanting fast funding

Goat Funded Trader 1-Step

Known for no restrictions and trader-friendly rules:

• Profit Target: 10%
• Daily Drawdown: 4%
• Max Drawdown: 10%
• Price: From $48
• Best For: Traders who hate time pressure

Best 2-Step Prop Firms 2026

Top Recommendations

FTMO 2-Step

The gold standard of prop firm challenges:

• Phase 1 Target: 10%
• Phase 2 Target: 5%
• Daily Drawdown: 5%
• Max Drawdown: 10%
• Best For: Traders wanting the most reputable option

FundedNext 2-Step (Stellar)

The best value with unique profit sharing:

• Phase 1 Target: 8%
• Phase 2 Target: 5%
• Daily Drawdown: 5%
• Max Drawdown: 10%
• Special: 15% of challenge profits paid on first funded withdrawal
• Best For: Value-conscious traders

Which Should You Choose?

Choose 1-Step If:

✅ You're a confident trader with proven skills ✅ You value time over money (faster funding) ✅ You have a consistent strategy that hits targets reliably ✅ You prefer less total fees from potential resets ✅ You trade with discipline under pressure

Choose 2-Step If:

✅ You're a beginner or intermediate trader ✅ You want lower pressure per phase ✅ You prefer smaller milestone targets (8% feels better than 10%) ✅ You have more time than money ✅ You benefit from psychological resets between phases

Decision Framework