Forex Compounding Calculator
Project month-by-month account growth with real profit splits and withdrawals. See how compounding stacks against flat withdrawals over any timeframe.
Input
FundedFast: 90%
Set to 0 for full compounding, or enter a fixed monthly payout
Result
Projected Balance after 12 Months
$84,794
+69.6% total growth
Total Gross Profit
$38,660
Your Share (90%)
$34,794
Total Withdrawn
$0
Compounding Bonus
+$7,794
Monthly Breakdown
Prop Firm Tip
5% monthly is a strong, sustainable target for funded accounts. At FundedFast's 90% profit split, a $100K account earning 5%/month nets you $4,500/month: $54,000/year.
What Is Compounding in Trading?
Compounding is reinvesting returns so that each period's gain is calculated on a larger base than the last. A 5% month on 10,000 adds 500; the next 5% month is calculated on 10,500 and adds 525. The effect is small at first and grows with time, which is why the number of periods matters more to the final figure than the rate does.
The Compounding Formula
One expression covers the whole projection. The calculator applies it per period and shows the running balance.
Final balance = Starting balance x (1 + Monthly return) ^ Number of months
The exponent is the reason growth curves upward rather than climbing in a straight line. Doubling the rate roughly doubles each single period's gain, but doubling the number of periods squares the multiplier. This is also why the projection becomes less meaningful the further out it runs.
Why Real Accounts Do Not Follow the Curve
The formula assumes the same return every month, and trading does not work that way. Losing months are not a slower version of a winning month; they reduce the base every subsequent month compounds from, and the recovery needed is larger than the loss in percentage terms. Withdrawals do the same. Treat the output as arithmetic showing what a constant rate would produce, not as a forecast.
Compounding on a Challenge Account
On a FundedFast challenge or funded account, both of which are simulated trading accounts, the maximum daily loss is 5% of your starting balance and the maximum total loss is 10% of your starting balance, raised to 20% where the drawdown add-on was purchased on an eligible account. Those limits are fixed against the starting balance rather than trailing peak equity, so profit does not raise the floor. A compounding plan that requires larger positions each month therefore consumes the same fixed allowance faster as it scales.
This section is educational information about how compounding arithmetic interacts with loss limits on a simulated evaluation account. It is not financial advice, and the figures this calculator produces are illustrative rather than a projection of results.
Compounding Calculator FAQ
How does compounding work in trading?
Each period's return is calculated on the balance produced by the previous one, rather than on the original amount. A 5% month on 10,000 adds 500, and the next 5% month is calculated on 10,500. The gap between compounded and simple growth widens with each period.
What is a realistic monthly return?
There is no rate that can be promised, and any figure entered here is an assumption rather than an expectation. The calculator exists to show what a given rate would produce arithmetically, which is a different question from whether that rate is achievable or sustainable.
How do withdrawals affect compounding?
They reduce the base every later period compounds from, so the effect is larger than the withdrawal itself. Taking a fixed amount monthly flattens the curve considerably over long horizons. The calculator has a withdrawal field so you can see the difference rather than assume it.
Why does the projection look unrealistic over long periods?
Because it applies the same return every single month with no losing periods, which no trading account experiences. The exponent makes small assumption errors compound too, so a projection that looks reasonable at six months can look absurd at sixty.
Does a losing month just cancel out a winning one?
No. A 10% loss requires roughly 11.1% to recover, and a 20% loss requires 25%, because the gain is calculated on a smaller base. Alternating equal-percentage wins and losses leaves an account below where it started.
Should I compound on a prop firm account?
That depends on rules that vary by firm and account, including how profit splits and payouts are handled, so it is worth confirming yours rather than assuming. What is arithmetic is that scaling position size as the balance grows consumes a fixed loss allowance faster.
What is the difference between simple and compound growth?
Simple growth calculates every period's return on the original amount, so the curve is a straight line. Compound growth calculates it on the running balance, so the curve bends upward. Over one or two periods the difference is negligible; over many it dominates.
Is this compounding calculator free?
Yes. It is free and does not require an account. Nothing you enter is stored or sent anywhere; the calculation runs entirely in your browser.