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Maverick74
Registered: Mar 2002
Posts: 17337 |
01-14-12 07:17 PM
Quote from Don Bright:
Yep, that's an option alright. As we query our current top traders, they're fighting adamanty against this. They like their independence, freedom, and tax benefits currently enjoyed.
Don
Good to chat with you my friend! Sitting home on a Saturday morning. I have had to actually re-train myself on my trading, LOL. all winning days this year, albeit small $$ (kinda busy catching up with stuff). First week good movement, last week seemed like everyone went on vacation.
All the best, Mav....
Don, they should not be fighting anything. You will have two choices. Hire them as W-2. Or back them 100%. If they are a "top" trader, you and your brother should be tripping over each other to back them and the amount of money they make will be the same. Nothing really changes for your "top" traders. The ones on the bottom and in the middle should be much more concerned.
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Don Bright
Bright Trading, LLC
Registered: Oct 2001
Posts: 11698 |
01-14-12 07:22 PM
Quote from Maverick74:
Don, they should not be fighting anything. You will have two choices. Hire them as W-2. Or back them 100%. If they are a "top" trader, you and your brother should be tripping over each other to back them and the amount of money they make will be the same. Nothing really changes for your "top" traders. The ones on the bottom and in the middle should be much more concerned.
I may have to invite you to chat with a group sometime to explain your points. They like being exempt from FICA (15%), they like being taxed on triple net, and they like the fact that they don't "work" for anyone.
Trust me, I know what you're saying, but the whole idea of losing the "floor trading business model" is being fought tooth and nail. The minimal amount of initial funding is generally a moot point, especially after a few months of good trading.
edit: after one or two withdrawals, they have no initial capital up anyway.
Don
__________________
Don Bright (not an alias)
Bright Trading, LLC
http://www.stocktrading.com
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Maverick74
Registered: Mar 2002
Posts: 17337 |
01-14-12 07:28 PM
Quote from Don Bright:
I may have to invite you to chat with a group sometime to explain your points. They like being exempt from FICA (15%), they like being taxed on triple net, and they like the fact that they don't "work" for anyone.
Trust me, I know what you're saying, but the whole idea of losing the "floor trading business model" is being fought tooth and nail. The minimal amount of initial funding is generally a moot point, especially after a few months of good trading.
edit: after one or two withdrawals, they have no initial capital up anyway.
Don
Don, it's simply a function of dollars. Let's take a guy named Gary. Gary is an independent trader at Bright and he made 500k last year net after all taxes and deductions.
Under the W-2 model, Gary will also make 500k net after taxes. He will have as much freedom before as he does now. He's not working for the government Don. He is trading. He is still going to be pair trading. Still doing what he does. Getting paid what he gets paid. Seriously, there is nothing to fear here.
The ones who are going to lose in this deal unfortunately are the bad and mediocre traders. As no one will "hire" them and they are more then likely under capitalized.
But you as a firm owner and your "top" traders, nothing will change. The fica tax issue is moot as it's all about net net, what you take home.
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Don Bright
Bright Trading, LLC
Registered: Oct 2001
Posts: 11698 |
01-14-12 07:28 PM
Not fighting you of course, you know I respect your opinions.
W-2 means the Firm can tell you what to trade, when to show up at work, how many shares to trade, and all the rest. Of course there are "top traders" who get slack, but there are also W-2 traders who make minimum wage with small bonuses. I'm not saying that's a bad model (especially in Chicago where everyoone should go if they can,, to learn on the floor, or upstairs firms).... but for many, it just isn't a viable option. Again, IMO.
Don
__________________
Don Bright (not an alias)
Bright Trading, LLC
http://www.stocktrading.com
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Don Bright
Bright Trading, LLC
Registered: Oct 2001
Posts: 11698 |
01-14-12 07:32 PM
Quote from Maverick74:
Don, it's simply a function of dollars. Let's take a guy named Gary. Gary is an independent trader at Bright and he made 500k last year net after all taxes and deductions.
Under the W-2 model, Gary will also make 500k net after taxes. He will have as much freedom before as he does now. He's not working for the government Don. He is trading. He is still going to be pair trading. Still doing what he does. Getting paid what he gets paid. Seriously, there is nothing to fear here.
The ones who are going to lose in this deal unfortunately are the bad and mediocre traders. As no one will "hire" them and they are more then likely under capitalized.
But you as a firm owner and your "top" traders, nothing will change. The fica tax issue is moot as it's all about net net, what you take home.
How is FICA 'moot'? I'm not understanding. I, myself, due to changes have been maxing out FICA and I hate it. See above about independence as well.
I guess we're typing over each other, my friend.
And, we never know which new trader will become "top" (as you say, not sure why the quotes?), and the independent, money up, is the only way to get from point A to point B ("top"). Believe me, I have been fooled many times with how well (or not well) new people have done.
Don
__________________
Don Bright (not an alias)
Bright Trading, LLC
http://www.stocktrading.com
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Maverick74
Registered: Mar 2002
Posts: 17337 |
01-14-12 07:32 PM
Quote from Don Bright:
Not fighting you of course, you know I respect your opinions.
W-2 means the Firm can tell you what to trade, when to show up at work, how many shares to trade, and all the rest. Of course there are "top traders" who get slack, but there are also W-2 traders who make minimum wage with small bonuses. I'm not saying that's a bad model (especially in Chicago where everyoone should go if they can,, to learn on the floor, or upstairs firms).... but for many, it just isn't a viable option. Again, IMO.
Don
Don, you are describing sweat shops in 1915 from an Upton Sinclair book. Nobody is making minimum wage. Think about it Don. Would you pay a "top trader" minimum wage? Why would they work for you over DRW? They wouldn't. Trust me, you'll pay them what they are worth. And no, you will not tell them what to trade or how to trade as they are, as you put it, "top traders". Don none of these firms in Chicago have that kind of control over traders. And none of them get small bonuses. Again, guys get paid what they are worth. Because, Don, if you don't pay them what they are "worth", they will go somewhere else. It's a pretty efficient market Don, believe me. It really is. What you are describing simply does not exist nor will it because the market place will not allow it to exist.
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