Does a prop firm need a liquidity provider?
Quick answer
Not for simulated accounts. A liquidity provider supplies real prices and executes real trades, which a simulation-only prop firm does not need. You do need a reliable live price feed. A liquidity provider becomes relevant if you decide to copy successful traders into real markets.
Detailed answer
Two different needs:
- Price feed: essential. Accounts must fill against real market prices with realistic spreads.
- Execution liquidity: optional. Only needed for real trades.
Firms that want to hedge payout risk sometimes open an account with a liquidity provider or broker and mirror selected funded traders. That is a separate risk decision with its own costs and legal implications.
PropExecutor includes a live price feed from cTrader at raw spreads, so a firm gets realistic fills without its own liquidity arrangement.
If you later want real execution
You would open an account with a broker or liquidity provider, fund it, and copy selected funded traders at a chosen ratio. That brings market risk, capital requirements and possibly regulatory questions, so treat it as a separate project with its own advice.
Price feed quality
Whatever you choose, make sure the feed your simulator uses is reliable and shows realistic spreads, because every rule decision depends on it.
PropExecutor team · Updated
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