The Prop Firm market has been expanding strongly in countries such as the United States, Australia, and many parts of Europe. However, in India, the proprietary trading model still faces significant restrictions due to the government’s strict regulatory framework and policies. Despite this, Prop Firms are “penetrating” India through educational activities. At the same time, CySEC’s new CFD restrictions are also being largely “brushed off” by traders.
Prop Firms dodge restrictions in India with “Education” branding
Proprietary trading companies appear to have infiltrated the Indian market by leveraging “education” campaigns to attract clients, while avoiding banned terminology such as “CFD” and “FX.” In addition, advertising in “Hinglish” – a blend of Hindi and English – has shown remarkable results.
According to an industry-wide study, India accounts for nearly 40% of the organic internet traffic of the top 50 proprietary trading companies. This growing local interest is also reflected in Google Trends, which shows a sharp rise in searches for “proprietary trading companies” and “proprietary trading” since 2023.
Firms are reshaping their messaging to overcome platform restrictions. They promote trading as “education” and offer “free demo accounts” instead of making profit promises or emphasizing FX and CFDs.
Brokers brush off CySEC’s new CFD limits
On the regulatory side, CFD brokers in Europe are adapting to new guidelines issued by the Cyprus Securities and Exchange Commission (CySEC), which tighten leverage restrictions on certain contracts.
To bring Cyprus closer to the EU’s stricter standards, the regulator has capped leverage for non-major commodity CFDs and index CFDs at 10:1. Brokers regulated by CySEC are modifying their product offerings and compliance systems to meet this directive.
This highlights a clear segmentation within the Prop Trading industry:
- In open markets (such as the U.S. and Australia), Prop Firms are booming, increasing payouts and expanding their product offerings.
- In restricted markets (such as India), Prop Firms are taking “indirect” routes through education or affiliate programs to reach traders.
- In Europe, the impact of new regulations may still be insufficient to significantly change the behavior of brokers and Prop Firms.
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