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-But gambling is subjective and open to interpretation. So if a firm wants to have rules that prohibit activity that they construe as gambling, then they need to clearly define what gambling means for them and what it doesn't.

Have a feeling that this link gets modified, so here is the full text to it. https://ftmo.com/en/gambling-is-not-...to-make-money/

Gambling is not the right way to make money

Trading in the financial markets is, in the eyes of the broad public, often perceived as some sort of gambling. Although this statement has little to do with the truth, there are plenty of traders who actually behave like gamblers when trading and unknowingly support this claim.
People are driven to gamble by the desire to make a quick buck. The problem is that a quick profit usually equals high risk and a low probability of success. And since financial markets are considered a risky markets where one can make a lot of money, many people automatically associate trading in financial markets with gambling.
However, the reality is different, and at FTMO we try to stress to our traders as often as possible that trading is not a sprint for quick money, but a marathon leading to consistent results over the long term. So what should traders look out for when trying to prevent gambling?
Choosing an untrustworthy prop trading firm can already be considered a type of gambling. Check the firm’s history, reputation and more. In the age of the internet, it is easy to obtain almost any information. Take the trouble to do a little research.
Look around social media, ask in groups, go through reviews from real customers. You should look for whether the company pays out money, what are their spreads and commissions, if they use their own technical solutions or if you’ll have to rely on the services of their contracted broker you’ve never even heard of.
Will anyone even answer you with sufficient professionalism when you ask their customer support a question, or will you wait several days for an email? And does it actually care about the trading community or is collecting fees the only interest here?
Are you intrigued by the overly simple account terms, extremely low prices and nonsensical payout terms? Simple terms and millions of dollars available right from the start may look appealing, but past examples from some companies clearly show that this model may not be really sustainable. A trader who is tempted by the simplicity of the terms may make money on the paper, but may not see them in his bank account.
Let us now take a look at some examples of risk trading.
Overleveraging
A classic example of gambling seen with many traders is overleveraging. Some traders feel that the larger the positions they open, the sooner they will make a fortune. Unfortunately, the reality is that such large positions often tend to increase trader’s stress due to a possibility of a large loss and ultimately result in a negative effect on the psyche, which in turn leads to more mistakes being done and initial trading plan sabotaged.
At the same time, trading of large positions (opened as a single entry or entered into gradually by further reinforcements of the trade) limits the trader’s options as in the case of trading for FTMO, a trader has to think about the Maximum Daily Loss objective. With each additional position being open, the trader increases the risk of exceeding the Maximum Daily Loss limit in case markets do not go their way. Thus, they have to reduce their Stop Losses (in points/pips) or simply cannot open another position that could potentially be profitable.
Some traders tend to increase their positions to the extreme a few days before the end of the FTMO Challenge or Verification when they are a few percent short of meeting the profit requirements. While this may seem like a good idea, in the event of a sudden move against the direction of their position, they may end up in the red or, in the worst-case scenario, violate the Maximum Loss condition. Most of the time, taking such a risk is not worth it at all, as with FTMO, you have options like a 14-day extension, or a free opportunity to repeat your FTMO Challenge.
Increasing positions while revenge trading is also problematic, especially when a trader has had a series of bad trades and wants to “make up” for them with one big trade.
Since the trader in such a case is certainly not in an ideal state of mental well-being, such a trade is likely to be an attempt outside the strategy, without risk management and with little chance of success, again with the risk of violating the terms and conditions.
In some cases, even a trader who has had a good run of trades may resort to excessive use of leverage, and his buoyant confidence tells him that if it works with smaller positions, why shouldn’t it work with the large ones?
Unfortunately, Murphy’s Law also works in the financial markets and usually, such a trade means an unnecessarily large loss and again the risk of violating the basic terms of the Trading Objectives.

Overexposure
Some traders tend to trade multiple instruments to diversify their risk. However, even here it may happen that a trader opens several positions representing several instruments or currency pairs, but at the same time, the trader is exposed to more risk on one instrument or currency. A typical case may be the opening of several positions on different major pairs. What looks like a diversified position could simply be one big dollar bet.
However, scaling in, or in the opposite case, diluting positions, is a similar case. Let us imagine a simple situation. You have caught a trend movement, everything is positive and you are merrily buying to make the highest possible profit. But is this the right approach?
Isn’t it actually the same trading idea all the time? Are you really living up to sound risk and money management in this case?
Dangerous are also situations when a trader opens a position or a combination of positions that are so large that they use the maximum potential of the available margin. Although the trading account technically allows it, from a risk and money management perspective this is not a safe approach, even if the trader has entered Stop Losses. An experienced trader understands concepts such as slippage, order execution at a different value, sudden price fluctuations, gaps, flash crashes, etc. Since the trading account behaves according to the real market liquidity, no one is ever guaranteed to execute according to the order entered.
In a nutshell, large positions or the sum of the sizes of a combination of several positions at the same time is a very risky approach and certainly not recommended at FTMO. A more conservative approach and risk control is always better, rather than trading in volumes that even the big players often do not trade. Remember that professionals usually risk only 1% and still make very interesting profits in a safe and stable environment and long term. No one wants to make rookie mistakes and quit trading prematurely due to the consequences of imprudent risk management and too large positions. Again, less is often more.
One-sided bets
A form of gambling can be opening one larger position on one instrument. Alternatively, this can also include buying up positions in profit or, heaven forbid, in loss, which we mentioned above.
If the first position itself is large and exceeds the limits of reasonable risk management, opening additional positions is pure gambling.
While it is true that opening additional positions on a profitable trade can be a profitable strategy in the event of a strong trend, are you really that confident about the long-term trend?
This is doubly true for opening a position at a loss because the desire to change the direction of the market as positions grow leads to unnecessary stress and a possible big loss, from which a trader can take a long time to recover.
Simply put, something like this has nothing to do with serious trading at all. A real serious trader has qualities, he has an advantage in his strategy that he can use, but not once, not twice, he can use it day after day, month after month and year after year.
A one-sided bet usually looks so tricky that the trader simply risks a large amount of free margin on a single market event, usually driven by macroeconomic factors. The market tends to move quickly in one direction, which of course may work once, but not the second or third time. Targeting the limits is always unnecessarily dangerous and risky.
The Evaluation Process in this case actually misses the point, as it says nothing about the trader at all, except that he likes undue risk and will not be much of a strategic long-term investment.
We don’t have to go far for example.
Can someone who bought Bitcoin for $500 in 2016 and remembered it at the end of 2021 be considered a trader? God forbid a consistent trader?
When bitcoin was hitting its highs, there were constant articles about bitcoin millionaires and their enjoyment of luxury and the endless bull trend. Suddenly (August 2022) when bitcoin is depreciating an incredible %, it is very hard to find such articles and photos with actual dates anymore. On the other hand, luxury goods classifieds sites are starting to fill up with ads to keep these “net traders” at least some cash flow.
This behaviour has nothing to do with trading at all. Those who hold an instrument for several years are more like investors and on the other hand, those who bet all their chances on one card belong more to the casino. If you want to experience the feelings associated with one-sided betting, go to the aforementioned casino, but avoid trading.

Account Rolling
An interesting case and form of gambling specific to prop trading firms is account rolling. In this case, traders will buy multiple evaluation courses at the maximum amount available. They manage to complete these (including Verification). However, due to the limitation of the maximum allocation for one trader/strategy, they can not trade on all accounts at the same time, nor can they combine them into one account.
This leads them to believe that they can open unnecessarily risky trades on the account they have received first, because if they recklessly breach that account, they can start trading in the next one almost immediately.
Yet FTMO tries to encourage traders to take exactly the opposite approach. Thanks to the Scaling plan, not only traders can get extra funds every four months, but also the payout ratio will improve from the classic 80:20 to a staggering 90:10 on the first top-up.
Something like this is impossible to achieve with excessive ordering, as the merchant recklessly violates one account after another.
Once a trader is able to complete several Verifications, he should have no trouble achieving an account increase, costing him much less money and receiving a larger percentage of his profits.
If someone is ordering accounts more than is healthy, according to mathematical probabilities, he has a pretty good chance of succeeding on several accounts, while breaking many of them. This is true, but it is certainly not something we would support because again it misses the point of our Evaluation Process where we are trying to test the trader and the robustness of their strategy. Anyone can keep rolling accounts one by one, but that says nothing about the trader. To some extent, we can also talk about abuse of the system and we would not like to see that in our traders, who are ultimately entrusted with the management of FTMO Account and from whom we expect consistent accountability.
Gambling is a very risky business. Trading is often demonised and it is no wonder nowadays. Remember why you started trading in the first place. Was your goal to make a quick buck? Wasn’t it instead about finding a consistent source of income that you can even make from anywhere in the world and over the long term?
We at FTMO are not indifferent to the mental health of our traders, nor to the image of trading as a whole. We actively monitor gambling practices and do not turn a blind eye to them. Come and help us and change the situation for the better. Let’s show that real traders are professionals who deserve respect. Professionals who are not afraid to take risks, but predefined risks. Professionals who have found a real edge in the market which gives them a long-term advantage. Serious traders are not get-rich-quickers who have made one trade, but professionals who have sacrificed a lot of time to learn what may seem just like lines and numbers to others.
And if the motivation for trading was to get rich quick, try the lottery or casino, that’s where you might actually succeed (better not do that either, it’s not the most sensible way to go).
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-Would be curious to know more about this. Do you believe the sources to be credible and that they are disclosing the whole truth? We probably should have this verified before getting too far with it. Unfortunately, Vitek-ftmo hasn't posted in the FTMO thread in over a month now.

So FTMO says in the new gambling rule that there is an overall lot size limit here, also based on all positions in total. (Not saying anything about max. correlations here)
"In a nutshell, large positions or the sum of the sizes of a combination of several positions at the same time is a very risky approach and certainly not recommended at FTMO."
But what are the limits here ? What is the hard overall lot size limit depending on account size ? And it is missing, what kind of overall leverage can be used and if the use of tight stoplosses and risk % per trade can overcome these limits to some extent, as indirectly said in above post/link from FTMO. So much room for interpretation.

I’m thinking the yolo traders will be mostly affected. Like takisd mentioned, other firms prohibit that type of trading from the start.

Honestly don’t think it’s a big deal if you’re smart and trading/flying under the radar.

The problem I see with FTMO they think that taking higher leverage and bigger lot sizes is a problem itself. It is not. There is market risk. If a swing trader holds a position for a full week with some red news on it, he can have much higher risk, than a scalper or short term trader who is holding large positions for only few minutes.

And they said that they do not want scaling in traders, even on swing traders. Because they can make huge payouts, as seen on youtube on a 500k payout trader here. But I have shown mathematically that when you have a trailing stop your overall risk in $$$ stoploss or absolute terms is not greater to any point when you scale in according to your trading profits. So this is second myth which is not true. I have posted several examples in prior posts based on RRR and trailing stops here. Math does not lie!! But what FTMO is saying is a clear lie. The only reason they do not want scaling in traders, that they do not have traders obtaining very large payouts !!!

So all in all what FTMO describes as Gambling is not true, it can be true, but it also does not have to be true. It matters how it is done. So their whole argue is Bulls--t!!

One of the best prop traders in Germany with some articles on it in the past, was trading the following. He watched DAX and BUND the whole week, and then once a week usually or so he entered a scalp with 250 contracts on BUND Future with scaling in up to 500 or 2000 contracts and then after making some ticks of profits also scaled out immediately. Usually done within a minute or two minutes. He had in his year trading at a real prop firm a 70:1 RRR annually. And FTMO would say gambler to him and banned him lifetime ? It would not matter because he is only a private fulltime trader anyway. But you see the time being in the market matters much more.

Bro take a breath, you’re hyperventilating again.

You're under the impression that most participants are methodical experienced traders, that’s never been the case.

Most are degen gamblers who get a win then think they are unstoppable. Nearly every trade they go all in and swing for the fence.

Here you above $1250 stoploss fixed at absolute terms while scaling in on a RRR 2:1 position. Over time the overall lot sizes increases much, because profits can be reinvested to increase the outcome. So instead you get RRR 2:1 of $1250 risk which is $2500 gain, with Euler compounding you get much more. But with having a trailing stop you can assure that to no time within the trade the max. loss goes over your initial set stoploss (here $1250). So scaling in per se is not the problem !!!

These kinds of rumors give traders the impression that a firm may actually be concerned about the firm's risk, and not the trader's risk, when in actuality, both should be in-line and in harmony with each other.

If the firm were truly concerned about both, we would see smaller leverage offerings, lot size limits, stop-loss requirements, much more realistic (and meaningful) challenge phases, anytime-withdrawals and so forth. But a firm would need to actually be copying trades over for this kind of reality. This would also be more akin to a traditional prop firm, so we might need to expect all of the additional hassles that go along with that.

For me, I am okay with a firm not copying trades so long as they pay out my profits. When we start seeing firms terminating accounts for unclear or made-up reasoning, then it starts to become a problem.

-I agree with you, to a point. There are two things that give me concern, though. One being, for legitimate traders that decide to take on higher-risk accounts, or, just happen to breach some unwritten risk parameter that causes them to lose all of their accounts and subsequently get labeled as a gambler (even though the reality is that they are a profitable trader).

The other concern is the precedent that it could set for other 'rules' to follow. If a firm sees that it can get away with banning accounts that generate too much profit, using undefined and ambiguous rules and reasoning, then they might feel inclined to look for more creative ways to do just that so that they are eventually left with all of the losers that continue to turn over accounts and never make a decent profit. The good traders would leave and refuse to trade with them and the bad traders would continue to buy accounts while dreaming about lambos. This would be a dream scenario for a ponzi-prop.

Because the truth is, at the end of the day, if a firm is not actually copying trades over (or selling data) in any way, whatsoever, then it bares to truth that profitable traders are simply bad for business. Does greed have limitations? I don't know. One would think that if 95% of traders fail (or whatever the current stats are), then that should be more than enough to sustain a non-trading business model and make really good profits while doing so.

Personally, if I started using lot sizes that were considered 'too risky' for a firm, then I would want them to tell me that and give me ample time to make adjustments rather than to terminate my accounts without warning. If things actually happened this way (and assuming that we have the whole truth), then that is bad, no matter how you look at it.

I understand what you’re saying, but honestly people are making too far too much of it.

Suffice it to say, most who are panicking from it are also those have who have yet to pull a payout.

scaling in shouldn t be a problem, nor having multiple positions opened at 1 time if the total risk is calculated etc...within the daily DD rules. thing is they started to implement this so called gambling rule when those huge payouts started to hit them. so, this might suggest not beeing able to pay out traders if such payouts continue. hence the need for gambling rule, cos clearly thus far they have benefitted from people gambling on challenges.
it s just a warning sign i guess, we ll see what happens in the near future, and how many will keep poppin up beeing banned for gambling from FTMO.

-Maybe. But if turns out that the rumors are true, then it could become important enough for the community to speak up, rather than to take a casual position about it. Wouldn't you agree? If you partner with someone in business, wouldn't you want to have the terms clearly defined regarding your business relationship and operating procedures? Because that is the potential issue here -- that FTMO may be enforcing risk rules that are not clearly defined.

-I cannot say that anyone is panicking about it, but to assume that only losing traders should be concerned about this is not something that I can agree with. To be clear, I do not think that this is any immediate cause for concern, but I do think that it could become one. It is worth discussing, I think.

https://www.forexfactory.com/thread/...h%20confidence

imo, i think the traders that have funded accounts and getting payouts should be concerned about this. this isn t affecting those who never get a payout, does it?

-I think, if firms like FTMO and others want to blacklist gamblers, then so be it. It will be better for the long-term sustainability of the firm. I just think that there are better, more honest ways, to go about it. I also think that such terms should be clearly-defined.

As traders (and business owners), we should strive for transparency and honesty with our partners, and that should go both ways. Believe it or not, for me, it is not just about money. I like to do things that I enjoy. That is partly why I chose to learn trading. At my age, I do not have the patience or tolerance for some things anymore. Well, some things, more than others, I guess.

I agree. However, if they want to blacklist gamblers, the entire model needs to change. They simply cannot ask you to flip an account in 30 days and then tell you it's a no go after you are funded. That is bait and switch at it's core.

Ive been getting regular payouts from FTMO and not really concerned at all. But im not a yolo degen gambler either.

The other point I was making is there are a lot of people that get worked up over whatever X prop firm is doing, or not doing. A lot of those same people have yet to pull a positive PNL, regardless if its a prop firm or personal.

Now that we have spent a good 7-8 hours discussing what could be absolutely nothing, has anyone seen or heard anything about this other than this thread?
If someone other than Takisd had posted this, I wouldn't have given it much attention at all. He does know a lot of heavy hitters though, so I consider this credible until someone proves otherwise.