Recently applied at a prop firm here in Canada called SFG Trading for remote trading. They told me their risk managers had assessed my application, and said I would be welcome to join their Trader Trial Program. These guys do not require a deposit of any risk capital, just a data fee of $149.00/month. They say I will start trading with real money, and if I meet their requirements and trade well - I can become fully contracted with them. The thing is this fee only covers a basic level 1 data feed and charts. They tell me i can subscribe to a separate data provider if I wish to get level 2 during the trial, and that if i become fully contracted with them - level 2 will be provided. The thing is, I am just a bit surprised they are letting me trade with real money after seeing a quick application form I filled out online.(although I would like to think I did show I know some things about trading well) And is it suspect that they only provide level 1 data to someone who is trading their money during the trial? Wouldn't you want to give someone trading your $$$ the tools they need? Could they just be profiting from marking this up, and is there a chance - I would not actually be trading with real $$$ as they have said? I am just wondering if I should be suspicious here or if I need to lighten up, and just do the program, and shell out for a bit of level 2 - which I am not against doing.
How are they charging you the $149/month with no money up? Or, are they just saying they will take it out of your Profits? If you are not contractually at risk or prevented from leaving at any time, you have nothing to lose but your time.
First rule in Finance : no free lunch. So yes, it is highly suspicious. They just want your money. Get away and apply for real banks / HF if you are talented. CM
Well I assume I would just be paying that up front on the month, but there is no risk deposit beyond that. It is true that the worst I stand to lose would be the $149 (or some more if I pay for my own level 2 data). There a is full contract to sign including noncompetition clause etc.- but yeah I can leave at any time as far as I know.
It is hard to find out much about this firm - there is a thread on this forum, but vague at best. As far as I can tell, they are an HFT and thus they keep a low profile. Unfortunately, im not interested or qualified to work at a bank. I am a day trader - that's it. Just a little undercapitalized as I start this career - I am working overtime alot to make the extra $$$ for my capital, but I would welcome the chance to trade prop on any legitimate opportunity. There are apparently other traders with this firm, ie. on linked in or facebook. Have not been able to reach anyone - but am trying to do some DD. As I mentioned, I might go for it - since the worst I stand to lose is the $149.00 or a bit more if I go for a few months before realizing its a scam. They do say there is a payout for profits in the initial trial phase - and all the fees you've paid for "data" are refunded if you trade profitably for six months. So why not give it a whirl?
Again, this sounds "too good to be true". I've never heard of a prop firm offering this kind of deal. What if you lose $200 per day for the first few days ? What happens then ? Can you post their contract terms ? I'd love to see the fine print on this deal.
They give conditions where your trades will be flattened by risk managment if you are in violation of risk rules. Also just noticed their head office is in Dubai - but they have offices here in Canada.
That is a concern: not allowed to operate in a "competing" business for 2 years after being with them. I presume that would mean I could not trade prop with anyone else if I sign.
The faq's on their site require more clarification. Since you're not putting up a deposit or paying for training fees, the only out of pocket is the access to the Sterling platform. You don't really need Level II data when you're on the simulator, since you have to use limit orders. My experience with Sterling is limited, however you will definitely want to examine the fills in the sim vs. a live account, as there could be major slippage. You can't just turn in the application and expect to get the live account, lol! It says you will have to make 500 trades and earn a profit of at least $1,000 before they will give you real money to trade. However, it contradicts that statement in a prior question, where it says "the first couple of days, new traders will be put in demo/Sim accounts." So, do they want you to make 500 trades in "the first couple of days" or what? It doesn't really specify the daily limit and maximum draw allowances in the simulator. The amount of starting buying power is $25k, and you must use limit orders to start. Profit splits are 50% to 90%, depending on W/L and Sharpe ratios. From just a cursory overview, it seems legit since you aren't risking any capital. The questions remain as to the live account, and if they will honor their terms of the agreement once you are a live trader. Regarding the non-compete, perhaps you may want to clarify the phrase "operating in a competing business" as it seems vague. Do they even have any competitors offering the same model? Also, find out if they take U.S. traders. Many firms domiciled offshore (including Canada) won't. Here's the link to their faq's: http://sfgtrading.com/faq/