Funded account compounding is not the classic “reinvest everything” story, because most firms reset your balance after each payout. This calculator shows both paths: keeping profit in the account to compound, and taking monthly payouts home.
Compounding calculator
Keep-profit path assumes the firm allows the balance to grow within drawdown rules. Payout path resets to the start balance monthly.
The formula behind it
Keep path: balance × (1 + monthly return)months. Payout path: start balance × monthly return each month, reset, repeat. The gap between the two paths is the price of certainty, and on funded accounts with resets, the payout path is usually the honest income number.
Worked example
$100,000 at 4% monthly for 12 months: keeping profit grows the account to ~$155,000 (+$55,000 on paper), while monthly payouts on a reset balance take home $48,000 in cash with zero risk of giving it back next cycle. Read the tradeoffs in prop firm payout math.
FAQ
Which path should I choose?
Accounts under a trailing drawdown usually favor payouts, because a growing balance can lift your drawdown floor and squeeze you. Static drawdown accounts with generous balance caps favor compounding for a while, then paying out.
What monthly return is realistic?
Sustainable funded traders plan 3-6% monthly with controlled risk. Strategies promising 20%+ monthly fit inside almost nobody’s risk of ruin tolerance, whatever the marketing says.