The 5ers, a renowned name in the world of prop trading, has recently announced a significant update to their news trading rules. This change, particularly focused on their HighStakes program, is poised to impact how traders approach high-impact news events. Understanding these new rules is crucial for traders to navigate the evolving landscape and maintain their trading accounts.

Understanding The 5ers

What is The 5ers?

The 5ers is a proprietary trading firm that offers various funding programs for forex traders. They provide opportunities for traders to manage substantial capital, enabling them to trade without risking their own money. By passing specific evaluation processes, traders can prove their skills and gain access to funded trading accounts. The 5ers was founded by Gil Ben-Hur, who serves as the CEO. The company operates under the legal entity of Five Percent Online LTD, headquartered in Israel.

The Major Change in News Trading Rule

New Rules Introduced by The 5ers

The recent announcement from The 5ers marks a significant shift in their approach to news trading. From now on, traders will not face account termination for holding trades during news events. Instead, a new rule has been introduced, focusing on a specific 2-minute window around high-impact news releases. 

Specifics of the 2-Minute Rule

According to the new rule, if a trader opens a position within 2 minutes before or after a high-impact news event, their account will be subject to a profit deduction. Additionally, Take Profit and Stop Loss orders will be triggered during these times, ensuring that trades are closed automatically based on predefined levels.

Implications for Traders

Profit Deduction for Trading Around News Events

The introduction of the 2-minute rule means that traders need to be cautious about opening positions close to high-impact news events. Failure to adhere to this rule will result in a deduction of profits from the affected trades, impacting overall profitability.

Triggering of Take Profit and Stop Loss

With the automatic triggering of Take Profit and Stop Loss orders, traders must ensure that their risk management strategies are robust. This feature helps protect accounts from extreme losses during volatile market movements.

Exclusive Application of the 2-Minute Rule

It's important to note that the new 2-minute rule is exclusively applicable to The 5ers' HighStakes program. Traders in other evaluation programs are still allowed to trade news events without facing these specific restrictions. While the HighStakes program now has tighter controls around news trading, other evaluation programs continue to offer more flexibility. This distinction allows traders to choose a program that aligns with their trading style and risk tolerance.

Holding Trades Over News Events

Allowance of Open Trades During News Events

One of the notable changes is that traders can now hold open trades over high-impact news events without facing penalties, provided these trades were opened well in advance of the news release. This flexibility offers traders more opportunities to manage their positions effectively.

Protection for Trades Opened Well in Advance

Trades that were initiated well before the designated 2-minute window are not affected by the new rule. This provision ensures that traders who plan their positions strategically can avoid the risk of profit deductions.

Account Termination Risks

Conditions Leading to Account Termination

While the new rules are more lenient in some aspects, The 5ers has outlined specific conditions that can still lead to account termination. Traders who engage in extreme risk-taking only during high-impact news events, without a history of consistent trading, are at risk.

Risk Management Team's Role

The 5ers' risk management team will monitor trading behaviors closely. Traders who receive warnings but continue to engage in reckless trading activities may face account termination and potential blacklisting from future funding opportunities.

Consistency in Trading

Importance of Consistent Trading History

To avoid penalties and account termination, traders must demonstrate a history of consistent and responsible trading. This consistency helps build trust with the prop firm and reduces the likelihood of disciplinary actions.

Measures to Avoid Account Termination

Traders can avoid termination by adhering to the rules, maintaining a disciplined trading approach, and heeding warnings from the risk management team. Building a track record of steady performance is crucial.

Warnings and Blacklisting

Warning System for High-Risk Trading

The 5ers has implemented a warning system for traders who engage in high-risk activities around news events. These warnings serve as a preliminary step before any severe actions, giving traders a chance to adjust their strategies.

Consequences of Ignoring Warnings

Ignoring warnings and continuing reckless trading can lead to severe consequences, including account termination and blacklisting. Blacklisted traders may be declined funding in the future, impacting their trading careers significantly.

Conclusion

The 5ers' recent changes to their news trading rules represent a significant shift in their approach to managing high-impact news events. By introducing the 2-minute rule and enhancing risk management measures, The 5ers aims to create a more stable and secure trading environment. While the new rule poses challenges, it also offers benefits for responsible traders who can navigate the updated guidelines effectively.