A lot of prop traders ask a simple question before buying a challenge:
Can I trade the news?
That sounds clear, but in practice it usually is not the right due-diligence question.
In prop trading, a firm can say news trading is allowed and still mean one of several very different things:
That is why traders get caught off guard.
The headline permission sounds trader-friendly, but the real rule can sit deeper in the help center, inside the funded-stage section, or in the exceptions around high-impact releases.
So the useful question is not just whether a prop firm allows news trading.
It is this:
What exactly happens to your trade, your profit, and your payout eligibility if execution occurs inside the firm’s restricted news window?
That question is much closer to the real economic rule.
For a trader who trades CPI, NFP, FOMC, or central-bank statements, the real issue is not just market access.
It is whether the firm lets you keep the outcome in a meaningful way.
There are at least three different rule structures hiding behind the same headline permission.
Some firms let traders operate freely during the challenge phase, then tighten the rule once the account becomes funded.
That means the challenge experience can train behavior that no longer maps cleanly to the account where payout rules matter most.
This is one of the easiest ways to misread a rulebook.
A trader may see “allowed” and assume event-driven profits are treated like any other profits.
Sometimes they are not.
The firm may apply a partial credit, a full no-credit rule, or some other post-cycle adjustment even though the trade itself was not blocked outright.
Some firms distinguish between opening or closing near the release and holding a position that was already on well before the event.
That difference matters for swing traders and traders who carry macro setups, because it changes whether the strategy is classified as planned exposure or event-window speculation.
FTMO’s official FAQ says traders may trade freely during macroeconomic news releases in the FTMO Challenge phases. But once the trader is on an FTMO Account, FTMO says opening or closing trades on targeted instruments is not permitted from 2 minutes before to 2 minutes after selected macroeconomic announcements. FTMO also says this exception does not apply to Swing accounts, which are available through FTMO Challenge: 2-Step.
That is an important distinction because it separates the evaluation experience from the funded-account rulebook.
FTMO also adds a detail traders should not ignore: positions may remain open if they were opened more than 2 minutes before the event, but if a Stop Loss or Take Profit is triggered inside the restricted window, FTMO says that can still be treated as a breach.
So in FTMO’s case, “news trading allowed” is too shallow a summary. The more accurate reading is that challenge-stage flexibility does not automatically carry over to the funded account, and event-window execution still matters even if the position was already open.
Source: FTMO, Can I trade news?
FundedNext’s official help pages show a different structure.
For its Stellar models, FundedNext says news trading is allowed in the challenge phase. But once a trader reaches the FundedNext Account, a News Profit Split Rule applies. On the models described in its help center, only 40% of profits from trades opened or closed within 5 minutes before or after a listed high-impact news event are counted toward the account. FundedNext also says losses remain fully applied.
That is a very different economic outcome from a plain-language “allowed.”
FundedNext also makes clear that the rule is not limited to manual market entries. It applies to pending orders, including SL and TP triggers, and the adjustment can affect reward eligibility after the cycle ends.
In other words, the trade can be permitted and still become less valuable than many traders assume.
That matters a lot for traders whose edge depends on short, high-volatility bursts around major data releases. If 60% of that event-window profit is stripped out while losses stay fully yours, the strategy profile changes materially.
Sources:
FundingPips shows why traders should read the full rule page instead of relying on a summary line.
Its official article says that for 1 Step, 2 Step, and 2 Step Pro, there are no restrictions on holding trades during news events during the evaluation stage. But the same page also says purposely trading news is prohibited and will lead to account closure.
That alone tells traders not to collapse “holding through news” and “actively trading the release” into the same behavior.
On the Master Account, FundingPips is more explicit. It says traders cannot open or close positions within a 10-minute window around a high-impact news event, profits from trades opened or closed inside that window will not be counted, and trades opened 5 hours before the event are excluded and may be closed within the restricted window with profits counted.
That is a nuanced but important structure.
It is not simply “news trading banned” and not simply “news trading allowed.” It is closer to this: event-window execution is restricted, but pre-positioned exposure may still be acceptable under defined conditions.
Source: FundingPips, Can I hold trades during the news and over the weekend?
A lot of prop-firm misunderstandings happen because traders focus on whether an account permits a behavior, not on how the rule changes the payoff.
But the payoff is the whole point.
If a funded account lets you place the trade but strips out most of the event-window profit, that is not the same product as an account where the full gain counts.
If a firm lets you hold a trade through the event but treats a TP fill inside the window as restricted execution, that is not the same as unrestricted news trading.
If evaluation is loose and funded is strict, then a strategy that looked viable while passing may become a poor fit once payout eligibility matters.
That is why the better reading framework is:
Those four questions tell you much more than a headline FAQ answer.
Before buying a prop challenge because the site says news trading is allowed, check these points on the official rule page:
Does the rule change after you pass? A challenge-friendly rule can become materially stricter on the funded account.
What is the exact time window? FTMO uses 2 minutes before and after selected releases. FundedNext uses 5 minutes before and after listed high-impact events. FundingPips uses a 10-minute window around high-impact events on Master accounts.
Do profits from those trades count fully? This is the question many traders forget to ask.
Are pending orders, SL, and TP triggers included? On some firms, they are.
Is there a pre-positioning exception? Some firms distinguish between trading the release and carrying exposure into it.
Which instruments and events are affected? Rules are usually tied to specific currencies, symbols, or high-impact releases.
Is the rule written as claim evidence or marketing language? If the headline sounds broad, scroll until you find the operational details.
In 2026, one of the most useful prop-firm due-diligence habits is learning to translate headline permissions into actual payout mechanics.
“News trading allowed” is not a complete rule.
Sometimes it means challenge-only flexibility. Sometimes it means funded-account restrictions. Sometimes it means a haircut on profits. Sometimes it means the trade is fine only if you were positioned early enough.
For real traders, that difference is not semantic.
It changes whether a news strategy actually fits the account you are paying for.
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