In short: Futures, spread bets and CFDs are complex, leveraged products with a high risk of losing money quickly, and most retail traders lose money. With real futures accounts you can lose more than you deposit. Prop firm challenge fees are usually lost, and funded accounts are usually simulated. Good Trading Guide is education only. It isn’t financial advice, and we aren’t authorised by the FCA. 18+ only.
This page sets out, in plain English, the main risks of the things we write about. Every page on Good Trading Guide links here. Please read it before you trade, buy a prop firm challenge, or open an account with any provider.
1. Who we are and what we don’t do
Good Trading Guide is a free education website. We are not authorised or regulated by the Financial Conduct Authority (FCA). We don’t give personal financial advice, offer trading accounts, hold client money, manage money or arrange trades for anyone. Nothing on this site is an invitation or encouragement to trade any product or use any provider.
2. Futures are complex and high risk
A futures contract is an exchange-traded agreement to buy or sell something (such as a stock index, oil or gold) at a set price on a future date. Futures are leveraged: your broker holds a margin deposit that’s a small fraction of the contract’s full value, so a small move in price is a large move in your account.
- Margin calls. If losses take your account below the maintenance margin, your broker can ask for more money or close your positions without warning, often at a bad price.
- You can lose more than you deposit. UK negative balance protection applies to spread bets and CFDs with FCA-authorised providers, not to futures. In a fast or gapping market a real futures account can go negative, and you owe the broker the difference.
- Fixed contract sizes. Each contract has a fixed value per tick. Even a “micro” contract can lose hundreds of pounds on a normal day’s move.
- Expiry and rollover. Contracts expire. Positions must be closed or rolled to the next contract, and that can cost you.
- Overseas brokers and exchanges. Most futures are traded on US exchanges, often through non-UK brokers. Check the broker’s regulation, client money protection and currency costs.
- Futures prop accounts are simulated. With most futures prop firms you trade a simulated account. You aren’t trading real futures, and the firm decides payouts under its own rules.
Learn how this works in our Futures Foundations module.
3. Spread bets and CFDs are complex and high risk
Spread bets and CFDs (contracts for difference) let you speculate on prices going up or down without owning the underlying asset. They’re leveraged: you put down a deposit (margin) and control a much bigger position.
Leverage works both ways. A small price move against you can wipe out a large part of your deposit, sometimes within minutes. That’s why the FCA treats these as complex, high-risk products.
Most retail traders lose money. UK providers must publish the percentage of their own retail client accounts that lose money. They recalculate it every three months over the previous 12 months, and the figure must appear in their risk warning. The figures vary by provider and over time, but they consistently show that most retail accounts lose money. Check the provider’s own current figure before you open an account. See why most traders lose money for the research.
Before you trade, ask yourself two questions: do you really understand how the product works, and can you afford to lose the money? If the answer to either is no, don’t trade.
4. How losses happen
- Losses can be fast. Prices can jump on news, at the market open or overnight. A normal stop-loss isn’t guaranteed. In a fast market, your trade can close at a much worse price than you set (“slippage” or “gapping”). Guaranteed stops usually cost extra.
- Losses can be bigger than you planned. Risking too much per trade, adding to losing trades, and trading to win back a loss are common ways beginners lose more than they meant to. See revenge trading and tilt.
- Costs add up. Commissions, exchange and data fees, spreads, overnight funding and currency conversion reduce your returns, and you pay them whether you win or lose.
- Negative balance protection has limits. FCA-authorised providers must make sure retail clients can’t lose more than the money in their spread bet or CFD account. Professional clients don’t get this protection and can lose more than they deposit, and it may not apply with providers outside the UK or firms that aren’t FCA-authorised. It doesn’t apply to futures accounts.
- Only trade with money you can afford to lose. Never trade with borrowed money, money for bills, or savings you’ll need.
5. Prop firm challenges: a paid test, and the fee is usually lost
A prop firm challenge (or “evaluation”) is a paid test. You pay a fee, trade under the firm’s rules, and if you hit the target without breaking a rule you may be offered a “funded” account.
- The fee is usually lost. Most people who buy a challenge don’t pass. Treat the fee as money spent, not invested. Many people buy several before passing, or never pass. Our true cost calculator shows what repeated attempts cost.
- Funded accounts are usually simulated. In most cases you trade a demo account with no real money behind it. The firm decides whether to pay you a share of the simulated profits under its own terms.
- Payouts depend on the firm. Firms can refuse payouts for rule breaches, change their rules, pause payouts or close down. Read the terms in full before you pay, especially on payouts, banned strategies and account termination.
- Futures prop rules are strict. Many futures prop firms charge monthly evaluation fees and use a trailing drawdown that follows your highest balance, plus consistency rules and contract limits. Rules differ between firms and change often.
- Passing isn’t proof of skill. A pass can be down to luck as much as skill.
6. Prop firms are mostly not FCA-regulated
Most prop firms that sell challenges to the public are not authorised by the FCA, and many are based outside the UK. In general:
- No FSCS protection for challenge fees or unpaid payouts if the firm fails.
- Usually no Financial Ombudsman Service. You may have to rely on the firm’s own complaints process or the courts where it’s based.
- Check the FCA Register yourself. If a firm says it’s FCA-authorised, look it up on the FCA Register and make sure the website and contact details match. Watch out for clone firms.
Even with an FCA-authorised provider, FSCS protection only applies if the firm itself fails and can’t return client money, up to a limit. It never covers trading losses.
7. Crypto and shares
- Crypto: Cryptoassets are highly volatile, and you could lose all the money you put in. Crypto derivatives (crypto CFDs, spread bets and similar products) are banned for UK retail clients. Be very wary of anyone offering them to you.
- Shares and funds: The value of investments can fall as well as rise, and you may get back less than you put in.
8. Education only, not advice
Everything on Good Trading Guide is general education. Nothing on this site is financial, investment, tax, legal, medical or mental-health advice, or a personal recommendation to buy, sell or trade anything. It doesn’t take your personal circumstances, goals or attitude to risk into account.
- Strategies, examples and worked calculations are for illustration. Examples are hypothetical unless we say otherwise, and any market or product we mention is an example, not an invitation to buy or sell.
- Learning to trade doesn’t guarantee profits, income or success. Many people who study trading still lose money. If we ever feature reader stories or testimonials, they won’t mean you’ll get similar results.
- Past performance, backtests and other people’s results are not a reliable guide to future results.
- You’re responsible for your own decisions. Do your own research, check the provider’s own website and documents (including its Key Information Document), and if you’re unsure, speak to an independent FCA-authorised financial adviser.
9. Tax
How trading profits and prop firm payouts are taxed depends on what you trade and your circumstances, and the rules can change. Read our plain-English UK tax guide, and speak to a qualified accountant or HMRC if you’re unsure. It’s general information, not tax advice.
10. Accuracy
We work hard to keep information accurate and show “last reviewed” dates, but providers’ prices, rules and terms change, and we can make mistakes. Information may be out of date by the time you read it. Always check with the provider before you act. If you spot an error, tell us at hello@goodtradingguide.co.uk.
11. Using this site
You use the information on this site at your own risk. To the extent the law allows, Genuine Part Sales Ltd isn’t liable for any trading or investment loss, or loss of profit, that comes from relying on content on this site. This doesn’t limit any liability that can’t be excluded under UK law.
12. How we make money
At the moment, Good Trading Guide doesn’t use affiliate links or sponsored content. If that changes, paid links will be clearly labelled (Ad) before you click, and firms won’t be able to pay to change our reviews or ratings. We may in future sell our own low-cost guides and workbooks. If we do, they’ll be our own products, and they’ll never promise profits or a challenge pass. Full details: how we make money.
13. If trading stops feeling like a choice
Fast, leveraged trading can feel a lot like gambling, and it can cause the same harm. If you’re chasing losses, hiding your trading, borrowing to trade, or it’s affecting your mood or sleep, please read When trading stops being healthy. Free, confidential help is available from the National Gambling Helpline on 0808 8020 133 (free, 24/7).
14. Age and location
This site is for people aged 18 and over in the UK. Products, protections and rules described here are UK-focused and may be different where you live.
About this site
Good Trading Guide is a trading name of Genuine Part Sales Ltd, a company registered in England and Wales, company number 17146896. Registered office: 66 Paul Street, London, England, EC2A 4NA. Contact: hello@goodtradingguide.co.uk.
Last reviewed: 18 October 2026.