Belgium's Financial Services and Markets Authority (FSMA) has issued a warning on the risks associated with the activities of so-called prop trading firms.。

Prop trading (proprietary trading) companies are institutions that trade for their own accounts, providing consumers with the opportunity to play the shadow investment game, a practice that costs money and can lead to reckless behavior.。They enable consumers to trade financial products such as stocks, bonds, commodities, cryptocurrencies, CFDs and foreign exchange products without using their own funds.。

Consumers must tackle a range of challenges before being allowed to trade financial products for proprietary trading firms。These courses are neither easy nor cheap, and consumers often have to attend and pay for several courses to successfully complete them.。There's a good chance that some consumers will never get through these courses, which is how prop trading companies make money。

Consumers who successfully complete the challenge receive a "certificate" - the company's own diploma - and are ready to start trading.。Consumers never make any actual transactions, they play on demo accounts of prop trading companies。The company may decide to conduct one or more simulated transactions for consumers on the actual trading platform.。If such simulated trading proves to be profitable, the consumer receives a commission。

However, only prop trading companies can decide under what conditions consumers can use their platform and which simulated transactions it will replicate。Therefore, it is difficult for consumers to determine whether they are entitled to any commission。As a result, consumers may spend a lot of time and energy without any compensation.。

The FSMA is getting more and more questions about such companies, with more and more ads for prop trading firms on social media.。Various websites offering paid courses are also emerging to help consumers successfully meet the "challenges" of prop trading companies.。These companies encourage the trading of complex financial instruments, such as CFDs and foreign exchange products, which are very risky and consumers often lose their entire investment, causing concern in the FSMA.。

As a result, the FSMA warned the public not to get involved in the activities of such prop trading firms.。In addition, it warns against the ecosystem of any company that uses props to trade the company's popularity。

The regulator stressed that prop trading firms are not authorized to provide investment services, as are prop dealers, who are defined as consumers who have successfully completed the course.。Many studies have shown that gaming factors in prop trading can lead users to overconfidence and recklessness, both in shadow investing and in actual trading using their own funds。