Funded7 New Risk Framework (OREF): New Standards for Fairness and Transparency

“Why are prop firm rules so opaque?”
“Why are payouts denied for vague reasons just because a trader made too much profit?”
We are ending these toxic industry practices.

Funded7 is introducing the “Optimal Risk Enforcement Framework (OREF)”—a system designed not to trap traders, but to protect and nurture “consistent professionals” who can survive in the markets long-term.

This article outlines our new Account Tier System and the transparent criteria we promise to uphold.

1. Principles & Operational Discretion (Disclaimer)

Before diving into the rules, we must clarify our operational stance.

As a core principle, Funded7 judges performance strictly based on published rules. However, the Risk Team reserves the right to intervene in two specific scenarios to protect the integrity of the trading environment.

First, Market Integrity:

During periods of extreme volatility (e.g., Elections, major financial events), risk parameters may be temporarily adjusted to ensure stability.

Traders will always be NOTIFIED in advance before any such changes take effect.

Second, Malicious Execution:

Trading patterns and behaviors that, under rigorous data analysis, are identified as abusive, systemic exploitation, or attempts to game the platform infrastructure or the rulebook in place will be classified as Malicious Execution. These cases will be treated as severe policy violations and dealt with accordingly, regardless of the specific strategy name.

2. Three Funded Account Tiers (Funded / Silver / Bronze)

At Funded7, we do not simply revoke a “Pass” because of a minor rule deviation. Instead, we offer a Funded Account in the “Optimal Tier” based on your trading data after clearing Phase 2.

• Note on Risk Cap (Flat Risk %):
  This single “Flat Rate” applies to everything: single positions, correlation buckets, and the total portfolio. No complex calculations required.
• Note on Graduation:
  “Successful Payout” means a request that was approved and paid out (not rejected). They do not need to be consecutive; a total of 3 successful payouts qualifies you for an upgrade.

3. Phase 2 Completion Flow (Manual Review)

Upon hitting the profit target in Phase 2, the system will temporarily lock the account for a Manual Review by our Risk Team.

We do not rely on simple pass/fail. We analyze your trading data to place you in the correct tier:

1. Verdict: Funded Account (Pass)

• All rules were followed, and trading was stable.
• → Start with Standard Terms (Leverage 1:50 / Risk 3.0%).

2. Verdict: Silver Funded Account (Conditional Pass)

• Target reached, but concerns regarding “Consistency (Rule 1)” exist (e.g., luck-based wins).
• → Not a Fail. You start on Silver (Risk 2.0%) to prove your wins weren’t luck. Achieve 3 payouts to upgrade to Pro.

3. Verdict: Bronze Funded Account (Conditional Pass)

• Target reached, but concerns regarding “Risk Management (Rule 2)” exist.
• → Not a Fail. You start on Bronze (Risk 1.0% / Leverage 1:20) to prove you can manage risk safely.

4. Violations & “Nullify” Policy (During Funded Stage)

We have abolished the practice of “Resetting (Confiscating) legitimate profits” due to rule violations.

For violations during the Pro Stage (Funded/Silver/Bronze), we apply the following fair procedures:

Case A: Consistency Miss (Rule 1)

• Scenario: Profit is made, but it is too skewed towards a single trade (Low QC Score, etc.).
• Action: Deferral (Payout Hold)
  – No Confiscation: Your profit remains yours.
  – No Strike: No penalty count is applied.
  – Remedy: Continue trading to “Cure” the data skew. Once your history normalizes, you may request the payout again.

Case B: Risk Violation (Rule 2 & 3)

• Scenario: Exceeding Risk % limits or violating Scalping rules.
• Action: Nullify (Void Violation Only) + Status Change
  – Partial Removal: We only remove the profit generated from the violating trades. Profit from compliant trades remains in your account.
  – 1 Strike: Recorded as a safety violation.
  – Response: The account status is generally changed to a “Restricted Tier” (e.g., Silver Funded), allowing you to resume trading in a controlled environment.
  – Note: Depending on the severity or frequency of the violation, the Operations Team may apply the Bronze Pro tier at their discretion.

Case C: Prohibited Conduct (Rule 4)

• Scenario: Gambling, Arbitrage, Group Trading, or other malicious behavior.
• Action: Termination
  – Immediate account closure and forfeiture of all profits (Zero Tolerance).

[IMPORTANT] Profit Nullification & Drawdown Policy If a compliance review identifies rule violations, the account will be adjusted as follows:

• 1. Profit Nullification: Profits generated from violating trades will be removed (nullified) from the account equity.
• 2. Loss Retention: Losses incurred from violating trades are RETAINED and will not be restored.
• 3. Verdict: If the account equity falls below the Drawdown Threshold (e.g., below 90% of initial balance) after the nullification, this constitutes a “Drawdown Breach via Non-Compliant Trading.”

Special Remediation Measure: Normally, a DD breach results in immediate termination. However, exclusively for cases where the breach is triggered retroactively by profit nullification, we may offer a Last Chance. Instead of termination, the account may be moved to a “Restricted Tier” (e.g., Bronze Funded) to allow the trader to rebuild their true performance.

• Note: If this scenario occurs while already in a Restricted Tier (Silver/Bronze), it will result in immediate termination.

5. Guide to Detailed Rules

All quantitative standards (formulas, time limits, banned strategies) are fully disclosed in the detailed articles below:

• [Rule 1: Consistency]
  – Definition of “Median” trade size and criteria to avoid being labeled a “One-Hit Wonder.”
• [Rule 2 & 3: Risk & Execution]
  – ATR formulas, Scalping time limits (15s/30s), and the complete Correlation Bucket List.
• [Rule 4: Prohibited Strategies]
  – Definitions of Martingale (OK vs NG) and other banned practices.