If they take all the risk, I would say that 50% payout is very good. On MUCH larger allocation I have seen 15% to 35% payouts. I have not seen a 50% payout for many years.
So, you think I should sign it? I'm hoping on bigger allocation over time depending on performance....
So they are giving you 7500 basically (50% of 15k). I think it might help if you tell us your goals and why you were seeking outside capital.
There is more to a deal than the deal. It matters who you are doing business with. Do you trust them. What does your contract say about trading other outside accounts. You have a VERY small allocation. Are they a broker dealer or a "customer." In either case, are they charging you a monthly desk fee and marking up their costs or only making money on your profits? There are more items to consider....you have to evaluate everything. In general, $15K is not enough to make a living on. I'm not asking these questions for your to respond to publicly.
Those are good questions to ask and consider. I have a FT job that pays well. This prop deal is for me to trade whenever I want to. So, I just trade an hour in the morning before work. And I can still trade my own account(s). My main question is the step up plan. I want to know how fast they will step me up in terms of allocations. I'm already net profitable and not a newbie. I asked about commission and they said it's 0.60 per side(futures). which isn't that great(?). trader99
No, they are giving me $15K as a starting balance. I put nothing down($0 deposit). 50% is on any net profits. The reason I'm seeking outside capital is I want to scale. The promise(yet to be seen) is that if I trade well, the allocation will scale fast and potentially significantly more than my present PA. Right now, I'm doing OK on my PAs. I'm hoping the allocation to be an order of magnitude more.
You guys are right. The deal does NOT make sense to me unless they scale my allocations up very quickly. Else I'm just making money for them and only getting back 50%. I'm making money now on my PA and I don't split it with anyone.
Can you send me a pm with the contact info for that prop firm. I have a one year profitable trading record real money though the account is a very small size.The return is excellent consistently profitable monthly .The three prior years I paper traded. Believe it or not paper trading is how I finally learned risk management which allowed me to make consistent monthly profits. I have real trading skills built from 15 years total experience. My situation is rare.I had sufficient trading capital before the recession and believe it or not never was able to recover cash and credit -wise after. Before the recession I had about 7 years trading experience with inconsistent results. I am patiently trying to self capitalize and have not been able to as yet. I didn't think any prop firms existed that will allow 0 risk capital. I would be interested even at 50% to start. I apply proper risk management with my position sizing and the only real issue I have is lack of capital.I am not willing to trade with borrowed money. Any suggestions are welcome. Feel free to private message me. I don't want to sidetrack your thread's main subject. I am really surprised any prop firms may offer a 0 risk capital requirement. I imagine most will consider me a hobbyist trader. Not true…I continued trading (paper trading) over the years in order to discover and eliminate faults plus build usable discretionary skills. I realize no one takes a paper trading account seriously. Now I have a real account (small,but real) with consistent returns. I'm sure many will now say sure the results are great but it's not enough of an account size to take seriously. I know in a couple more years of consistent profitable trading and 10x the account size I'll be given a chance. In the meantime thanks for any tips anyone sends.My annual roi is above 50% with a restricted cash account.(no leverage,no shorting). The ironic thing is once the account size is 10x the tiny size it is now I will then be partially self capitalized enough to where I wouldn't consider props anymore. I would focus on improving roi….