Evaluation Phase

An evaluation phase is the core product of most prop trading firms. When a trader makes a challenge purchase, they enter an evaluation period where they must demonstrate their ability to generate profits while adhering to strict risk parameters -- such as maximum daily drawdown limits, overall loss limits, and minimum trading day requirements. Only traders who meet all criteria within the evaluation period advance to a funded account where they trade the firm's capital and receive a profit split.

The evaluation structure has a direct impact on affiliate economics. The challenge purchase is the primary conversion event in prop firm partner programs, and affiliates typically earn a CPA commission when a referred trader completes that purchase. Pass rates, retry behavior, and reset fee purchases all affect the firm's unit economics -- and by extension, the commission rates that are sustainable for the affiliate program. Firms with high pass rates may need to offer lower CPAs, while firms with more rigorous evaluations can sustain higher affiliate payouts per conversion.

Common evaluation structures include one-phase challenges (single assessment with a profit target), two-phase challenges (an initial evaluation followed by a verification phase with a lower target), instant funding (no evaluation required, higher fees), and free retries (traders who fail within certain parameters get another attempt). Each structure attracts different types of traders and influences how affiliates position and promote the product to their audience.