Is There an Option Prop Firm? Complete Options Trading Guide [2025]

Is there an option prop firm? Yes, but options trading at prop firms is far less common than forex or futures. Most prop firms focus on forex, indices, and futures markets, leaving options traders with limited funded account opportunities. This comprehensive guide answers what prop firms allow options trading, compares your best options, and explains why the landscape looks the way it does in 2025.

Is There an Option Prop Firm? Understanding the Landscape

The prop firm industry has traditionally focused on markets with high liquidity, standardized products, and straightforward risk assessment—primarily forex and futures. Options present unique challenges that have limited prop firm adoption.

Why Options Prop Firms Are Rare

Several factors explain the scarcity of prop firms offering options:

Complex risk assessment: Options pricing involves Greeks (Delta, Gamma, Theta, Vega) that make risk evaluation more complex than linear instruments
Unlimited loss potential: Naked short options can theoretically produce unlimited losses, creating significant firm risk
Lower liquidity: Many options contracts have wider spreads and less volume than forex pairs
Margin complexity: Options margin requirements are dynamic and can change rapidly
Strategy diversity: Options traders use hundreds of different strategies, making standardized rules difficult

These factors don't make options unprofitable—they make them harder to fit into the standard prop firm evaluation model.

What Prop Firms Allow Options Trading?

Despite the challenges, several firms do offer options trading. Here's the complete list of prop firms that allow options trading in 2025:

Topstep (Futures Options)

Topstep offers futures options trading within their funded accounts. Key details:

Market: CME futures options (ES, NQ, CL options)
Account sizes: $50K-$150K
Evaluation: Trading Combine with profit targets
Restrictions: Some strategies limited (naked short positions restricted)
Platform: NinjaTrader, TradingView, and others

Apex Trader Funding (Futures Options)

Apex allows futures options alongside standard futures trading:

Options allowed: Yes, on futures products
Account sizes: Up to $300K
Profit split: 100% first $25K, then 90%
Evaluation: Single-step evaluation

Elite Trader Funding (Limited Options)

Elite Trader Funding permits some options activity on their futures accounts:

Futures options: Allowed with restrictions
Static drawdown: Available on some account types
Fast evaluation: Can pass in one day

Trade The Pool (Stock Options)

Trade The Pool is one of the few firms offering equity options:

Market: US stock options
Account sizes: $20K-$260K buying power
Strategies allowed: Long calls, long puts, defined-risk spreads
Restrictions: No naked short options, limited to defined-risk strategies
Profit split: 50-80% depending on tier

T3 Trading Group (Traditional Prop)

T3 is a traditional prop firm (not evaluation-based) that allows options:

Model: Capital contribution required (deposit your own funds)
Options: Full options strategies available
Location: US-based traders primarily
Not suitable for: Traders seeking evaluation-only funded accounts

Options Trading Rules at Prop Firms

Even firms that allow options typically impose significant restrictions.

Common Restrictions

No naked short positions: Selling uncovered calls or puts is usually prohibited
Defined-risk only: Many firms require all positions have limited maximum loss
Position limits: Maximum number of contracts or total delta exposure
Expiration restrictions: Some firms prohibit holding through expiration
Greeks limits: Maximum Vega or Gamma exposure caps

Allowed Strategies (Typically)

Long calls and puts: Maximum loss is premium paid
Vertical spreads: Bull call, bear put, credit spreads with defined risk
Iron condors: Defined-risk neutral strategies
Butterflies: Limited risk, limited reward structures
Calendar spreads: Time-based strategies (firm-dependent)

Usually Prohibited

Naked short calls: Unlimited upside loss risk
Naked short puts: Large downside risk (some firms allow with restrictions)
Ratio spreads with naked legs: Undefined risk exposure
Short strangles/straddles: Undefined risk on both sides

Futures Options vs Stock Options

Understanding the difference helps you choose the right firm.

Futures Options

Options on futures contracts (ES, NQ, CL, GC):

Underlying: Futures contracts rather than stocks
Liquidity: Generally good for major indices and commodities
Availability: More prop firms offer futures options
Hours: Extended trading hours (near 24/5 for some products)
Tax treatment: Section 1256 contracts (60/40 long-term/short-term)

Stock Options

Options on individual equities:

Underlying: Shares of individual companies
Selection: Thousands of optionable stocks
Liquidity varies: SPY, QQQ excellent; small caps can be illiquid
Prop firm availability: Very limited
Hours: Regular market hours only

Alternatives for Options Traders

If traditional prop firms don't suit your options strategy, consider these alternatives:

Self-Funded Small Accounts

Many brokers offer small account options trading:

Start with $5,000-$10,000
Trade your preferred strategies without restrictions
Build track record for potential future prop opportunities

FTMO and Similar Firms (Forex Focus)

If you can adapt to forex:

Much larger selection of firms
Higher profit splits (80-95%)
More straightforward rules
TradersYard offers forex evaluations from €36 with flexible rules

Futures Prop Firms

If you can trade futures instead of options:

Linear instruments (easier risk assessment)
Excellent prop firm selection
Similar market exposure to options underlyings

Evaluation Challenges for Options Traders

Options present unique challenges for prop firm evaluations.

Time Decay Factor

Options lose value over time (Theta decay). This means:

Profit targets may be harder to achieve with long options
Time limits on evaluations conflict with options time decay
Premium sellers have edge but face unlimited risk restrictions

Drawdown Calculation

Options P&L fluctuates with volatility, not just price:

A position can be "correct" directionally but still lose money if volatility drops
Mark-to-market values can swing significantly
Standard drawdown rules may not account for options dynamics

Frequently Asked Questions

Is there an option prop firm?

Yes, but they're less common than forex or futures prop firms. Topstep, Apex Trader Funding, and Elite Trader Funding offer futures options. Trade The Pool specializes in stock options. Most restrict strategies to defined-risk positions.

What prop firms allow options trading?

Firms that allow options include Topstep (futures options), Apex Trader Funding (futures options), Trade The Pool (stock options), and Elite Trader Funding (limited futures options). Traditional firms like T3 Trading also offer options but require capital contribution.

Why don't more prop firms offer options?

Options involve complex risk assessment (Greeks), potential for unlimited losses on naked positions, dynamic margin requirements, and hundreds of possible strategies. These factors make standardized evaluation rules difficult to implement fairly.

Can I sell options at a prop firm?

Generally, only defined-risk short options are allowed (credit spreads, iron condors). Naked short calls are almost universally prohibited. Some firms allow naked short puts with position limits. Always verify specific firm rules before trading.

Which is better for prop trading: futures options or stock options?

Futures options have better prop firm availability and often better liquidity on major products. Stock options offer more underlying selection but very few prop firms support them. If prop trading is your priority, futures options provide more opportunities.

What if my options strategy doesn't fit prop firm rules?

Consider adapting to defined-risk strategies, switching to forex or futures (more firms, better profit splits), or building a self-funded account. Many successful options traders maintain personal accounts alongside prop trading in other instruments.

How to Choose an Options Prop Firm

If you're determined to trade options through a prop firm:

Evaluate Based On:

Strategy compatibility: Can you execute your actual strategies within their rules?
Products available: Do they offer the underlyings you trade?
Greeks limits: Are position size limits workable for your approach?
Drawdown calculation: How do they handle options mark-to-market?
Time limits: Options strategies may need longer timeframes

Conclusion

Is there an option prop firm? Yes, but options traders face a more limited landscape than forex or futures traders. The firms that do offer options typically restrict strategies to defined-risk positions, eliminating many popular approaches like naked short premium selling.

If you're committed to options, Topstep, Apex Trader Funding, and Trade The Pool provide viable paths. If you're flexible on instrument choice, the forex prop firm world offers significantly more options with better terms.

For traders open to forex markets, TradersYard offers evaluations from €36 with flexible rules, no time limits, and sub-4-hour payouts. Their scaling to $500K and 80-95% profit splits make forex prop trading highly attractive for traders willing to adapt their approach. Start your evaluation today.