Proprietary trading firms, commonly known as
prop firms, engage in trading financial instruments using their own capital rather than clients' funds. These firms typically employ skilled traders who execute trades across various asset classes, including stocks, options, futures, and forex. Prop trading firms often use advanced technology, quantitative analysis, and algorithmic trading strategies to identify profitable opportunities in the market. Traders at prop firms may receive a share of the profits generated from their trading activities, providing an incentive for success. Overall, prop trading firms play a significant role in providing liquidity to financial markets and driving innovation in trading strategies.