The Do’s and Don’ts of EA Trading on Prop Firm Platforms: Your Non-Negotiable Rules Checklist

For an Expert Advisor (EA) to succeed with a proprietary trading firm, it must operate within two boundaries: the statistical edge of its code and the strict, often arbitrary, rules set by the firm. Many profitable EAs are disqualified not because of poor performance, but because they unknowingly violated a fine-print rule. These rules are designed to filter out mechanical strategies that rely on arbitrage or latency gaps, ensuring that funded traders display genuine market skill. Your EA is a tool, but you are the manager, and compliance is your number one job.

This checklist is your pre-launch audit—a mandatory step to ensure your Prop Firm Expert Advisor is compliant before risking your challenge fee or funded capital. Every “Don’t” must be addressed by an explicit filter or hard stop coded into your EA’s logic.

The DO’S: Strategies for Compliance and Success

These are the non-negotiable best practices to ensure your EA maintains a professional and acceptable profile.

The DON’TS: The Rules That Kill Profitable EAs

These are the common pitfalls that lead to instant disqualification, even if you are profitable. They reflect what the prop firm does not want to see on their books.

DON’T #1: Trade During News (Unless Allowed)

• The Violation: Many firms prohibit opening or closing trades a few minutes before or after high-impact news events (e.g., NFP, FOMC). EAs often execute based on volatility, which peaks during these times.

• The Fix: Your EA must have a robust news filter integrated. It checks the time against a pre-loaded news calendar and pauses all trading activity during the prohibited windows.

DON’T #2: Engage in HFT/Latency Arbitrage

• The Violation: Using the EA to exploit tiny, millisecond price discrepancies between two different broker feeds. This is a common EA strategy but is explicitly banned by almost all legitimate prop firms.

• The Fix: This isn’t a setting, it’s a design choice. If your strategy relies on tiny price differences or very fast entry/exit cycles (sub-second), you need to choose a different strategy or a firm that explicitly allows it (which are rare). The strategy must be compliant from the start, as discussed in How to Select the Right Prop Firm for Your EA Strategy.

DON’T #3: Use Martingale or Hitting the Max Lot Size

• The Violation: Martingale (doubling or heavily increasing lot size after a loss) is considered reckless and is banned by many firms due to the high risk of catastrophic loss. Hitting the maximum allowed lot size without justification can also be flagged.

• The Fix: Your EA’s lot-sizing must be fixed, based on a calculated percentage of equity, or a conservative fixed size. The logic must be defensible.

DON’T #4: Trade Multiple Accounts with Correlated Strategies

• The Violation: Running the exact same EA on multiple prop firm accounts (or multiple accounts with the same firm) and having highly correlated trades. This is seen as exploiting the firm’s pooled risk and is grounds for immediate termination.

• The Fix: If you run the same EA on two accounts, you must vary the Optimizing EA Parameters for Prop Firm Phase 1 & 2 Challenges—different currency pairs, different timeframes, or different key inputs—to ensure the trade IDs and timing are not perfectly correlated.

DON’T #5: Leave Trades Open Over the Weekend (The Rollover/Swap Trap)

• The Violation: Holding a trade over the weekend, especially with negative swap/rollover rates, can unnecessarily eat into profits and violate specific firm rules.

• The Fix: Your EA must be coded to check the day and time (e.g., Friday at 4:30 PM EST) and close all open positions, preventing trades from rolling over.

The Continuous Compliance Audit

Compliance is not a one-time check; it is a continuous audit. You must periodically review the trading journal to ensure your EA has not fallen out of compliance. This ongoing analysis is the final layer of defense against an account breach.

By using this checklist to build and manage your Prop Firm Expert Advisor, you transition from being a passive EA user to an active risk manager, significantly boosting your probability of long-term funding success.