Prohibited Trading Practices
Prohibited Trading Practices at Nordic Funder
Nordic Funder proudly operates a funded trader program offering maximum flexibility to our traders. We allow many things our competitors don’t, such as trading with expert advisors or copying from your other accounts or preferred platforms. And we don’t have requirements like minimum or maximum trading days, consistency rules, news trading restrictions, or strict rules on scalping.
In our experience, strict rules concern genuine traders that they might accidentally break them or potentially be twisted and used against them. However, being vague on the topic is counterproductive. Therefore, we’ve decided to write this article explaining what we seek from our traders and what we consider exploitative.
Essentially, we seek unique and replicable trading strategies. Based on this objective, Nordic Funder prohibits these trading practices.
High-frequency trading (HFT) strategies
HFT trading strategies are difficult for us to replicate due to latency and hard to monetise because we copy your trades based on a multiplier, leading to a worse execution price for us due to slippage.
We’ve tested many HFT strategies; unfortunately, they don’t generate revenue for our prop firm. If you want to trade with an HFT, we suggest signing up with a broker, not a prop firm.
Commercial Expert Advisors (EAs)
A commercial EA is an automated trading strategy purchased from a vendor and used without any modifications from the user. Our prop firm must ensure funds are allocated to unique strategies to manage risk. If too many users follow the same strategy, our risk management becomes uncontrollable.
Community trading
Similar to the prohibition on using commercial EAs, if a community of traders join Nordic Funder and follows the same signals or strategy, we will have too much exposure to a given strategy. We do not allow groups of traders to join with the same trading strategy.
Prop account hedging
Account hedging is a practice of using multiple prop firm accounts to hedge. The objective is for one account to fail and the other to pass and get a funded account without risk. Understandably, this is not a trading strategy or productive for the prop firm.Suppose someone has two 50K assessment accounts and is long 5 lots of XAUUSD in one account and short 5 lots of XAUUSD in the other.
Now suppose the price of gold rose by $10. In this case, they could generate a $5,000 ($4,500 net) profit in one account while breaching the daily loss in another. Some abusers may purchase multiple assessments to do the same trick when funded.
Concentrated Strategies
We want to fund strategies that are diversified across a number of different symbols/asset classes. Strategies that are concentrated in one symbol are less likely perform consistently over time. If a strategy is not diversified, we may reject accounts that have reached the target profit. In order for a strategy to considered diversified, there should be multiple unique symbols traded and volume should be relatively equal.
Relying on luck
The prop firm business model allows traders to trade substantial capital with fixed and proportionately much lower person risk. While candidates only risk the assessment fee is a major unique selling point, it also attracts traders who want to take advantage of the model.
We’ve encountered several traders who use all their margin and max lot allowance to go “all-in” on one symbol or correlated symbols, typically targeting volatile indices or commodities markets where it’s possible to make 10% in a single trade.
Our goal in Nordic Funder is to find and empower good traders with unique and efficient strategies. Unfortunately, many traders nowadays look to build strategies to “play” with the prop firm business model.
Strategies in this category are systematic and aggressive and include the purchases of multiple accounts and risky positions with the intent of going “all-in”. Although we don’t have rules prohibiting traders from having multiple accounts or being aggressive, we won’t accept any assessment where all the profit was earned from single or concurrent correlated positions. We are looking for strategies, not single trades.
Prop firm passing services
Some traders think that taking an assessment is a waste of their time. The assessment is how we understand and evaluate trading methodology, strategies and risk management. Therefore, if someone uses a prop firm passing service, it eliminates our ability to understand their strategy before allocating real funds.
Nordic Funder only has a one-stage assessment; please take it seriously and respect our business model.
Consequences of prohibited trading practices
Firstly, please don’t try to engage in prohibited trading practices at Nordic Funder. It’s only going to waste time for both parties.
If we are certain someone has engaged in one of these practices, we will terminate our relationship immediately. In such cases, we won’t issue refunds.
However, in many cases, we cannot be certain and base our decisions on behaviour, patterns and experience rather than concrete evidence. Therefore, we shall discuss our concerns with traders, possibly offer a retry or simply void accounts and issue refunds to users we suspect are engaging in prohibited trading practices.
If you are concerned your strategy may conflict with our rules, please reach out and discuss. The bottom line is if you’re joining to trade honestly, Nordic Funder welcomes you. If you’re joining to exploit the prop firm business model, please stay away.
Exploitative Strategies
We strictly prohibit engaging in activities such as purchasing accounts or risking full margin in a single trade. These practices are considered as playing the system and are not permitted within our trading guidelines. Our aim is to maintain fair and responsible trading practices for all participants. Please refer to our full list of prohibited trading practices for further details.
The bottom line is: we seek unique, efficient and replicable trading strategies.
