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How news trading rules work at prop firms

The common types of prop firm news rule, from blackout windows to profit adjustments, with worked examples and a checklist for reading the terms.

November 3, 2026

4

Major economic releases can move markets more in a minute than in the rest of the session. Prop firms treat that volatility as a risk to their capital, and many have rules about trading around it. Those rules vary more than almost any other, and misreading them is an easy way to lose profits or fail an account.

This lesson explains the common types of news rule and how to check the one that applies to you.

What counts as "news"

Firms usually mean scheduled, high-impact economic releases, such as central bank rate decisions, inflation reports and employment data. Economic calendars rank events by expected impact, often with color codes, and many firms refer to the highest tier (sometimes called "red-folder" news). Some firms publish their own list of restricted events. If a firm restricts news, find out which list it uses.

Common types of news rule

1. News trading allowed

Some firms place no restriction on trading around news, at least on some programs. Even then, your daily loss limit and maximum drawdown still apply to any losses.

2. A blackout window

The most common rule bans opening or closing trades for a set number of minutes before and after a release. With a 2-minute window around an 8:30 a.m. release, you cannot open or close trades from 8:28 to 8:32. With a 5-minute window, the restricted period runs from 8:25 to 8:35.

Check whether the window covers only opening and closing trades, or also pending orders and stop-losses that trigger inside it. A stop-loss filling in the window can count as a closed trade.

3. Different rules by stage

Many firms allow news trading during the evaluation but restrict it on funded accounts, or allow it on one funded account type but not another. A strategy that passed the challenge may not be allowed once you are funded.

4. Profit adjustments

Instead of banning news trades, some firms reduce how much of their profit counts. For example, if a firm counts news-window profits at 40% and you make $1,200 on a news trade, only $1,200 x 0.40 = $480 counts toward your payout.

5. Instrument-specific restrictions

Some rules apply only to instruments affected by the release. A US data release might restrict USD pairs and US index futures but not unrelated markets. Others apply to every instrument on the account.

6. Holding versus trading

Some firms let you hold a position through a release as long as you do not open or close it inside the window. Others require you to be flat.

What happens if you break the rule

Consequences range from removing the profit from the affected trades, to a soft breach that closes positions, to failing the account outright. The rule text should say which applies. If it does not, ask the firm in writing.

The hidden cost: slippage and spreads

Even where news trading is allowed, fills around a release can be much worse than normal. Suppose you trade 1 standard lot of EUR/USD, where a pip is worth about $10, with a 15-pip stop. Your planned risk is 15 x $10 = $150. If the stop slips by 10 pips in a fast market, it fills at 25 pips, and your loss is $250, two-thirds more than planned.

Spreads also widen around releases, which can trigger stops or count against an equity-based daily limit. Check pip values with the pip value calculator and size down with the position size calculator if you trade near news.

A checklist for reading a news rule

  1. Which events are restricted, and where is the list?
  2. How many minutes before and after the release does the window cover?
  3. Does it apply in evaluation, on funded accounts, or both?
  4. Does it cover opening, closing, pending orders and stops, or only some of these?
  5. Does it apply to all instruments or only affected ones?
  6. What is the penalty: profit removed, positions closed or account failed?

Our list of prop firms for news trading quotes each firm's verified rule, and the comparison tool shows news rules side by side.

Examples use hypothetical numbers for illustration. Trading futures, forex and CFDs involves risk, and nothing here is financial advice.

FAQ

What is a news blackout window?

A set number of minutes before and after a release in which you cannot open or close trades. A 2-minute window around 8:30 a.m. runs from 8:28 to 8:32.

Can news trading be allowed in evaluation but not when funded?

Yes. Many firms set different news rules by stage, so check the rule for both the evaluation and the funded account.

Educational content only, not financial advice. Trading involves substantial risk of loss. Prop firm rules change often; check the firm's official terms. Some links may be affiliate links; see our disclosure.

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