Any advice building a new trading group risk parameters?

Discussion in 'Prop Firms' started by ronin266, Jun 28, 2012.

  1. A friend of mine offered me to open a small trading group in the near future, like a max. of 10 traders, including myself and him. And the rest will be green guys who will be trained from scratch.

    I would like to ask some advice regarding the overall risk parameters and how should they be managed for the new guys?. I mean, take 5-10k per person and treat them as "education costs" for their first year from the begginin?, or manage the risk separatelly with some margin for their losses in the trading group itself including us?.

  2. Your front-end platform should be able to give you a decent risk manager for sub accounts.

    This is very over-simplified but essentially you create a master account and then branch out sub-accounts from there. The front-end's risk manager allows you to set all kinds of parameters such as buying power, share size limits, etc. (it all depends on the platform).

    I'd suggest that you meet with every front-end sales team that your clearing firm can link with. By the time you get through their intro sales pitches you will have a pretty good idea of what each one can/can't do in terms of risk.

    Good luck.
  3. Thanks, but I wasn´t asking about the risk management itself, there is no problem with that, I´ve already met with almost every platform out there and know what every one of them offers in terms of risk management capabilities.

    I was asking about an advice regarding the form that the first year losses should be managed. If they should be delimited from the beggining with a separate cashflow and capital cushion, or be treated as general trading risks and managed accordingly.
  4. emg


    let me get this straight. Your previous thread hinted (in my mind) u were doing a research on fictitious vs factual trades. Now, u want to build a risk parameters (GROUP).

    Alert to SEC. Alert Alert
  5. LOL You´re taking it from the wrong side pal. The previous research was for the purpose of spotting that practice in case that it appeared with the chosen trading services provider.

    Traders will be fully backed, so I don´t see where can I earn something practicing fictitious trading. (Anyway, would that be the case, I would not ask such questions in a public forum :), hi to the SEC guys (if any of them know at least how to use a PC LOL))

    I don´t plan to take Velez market niche. :D :D

    Don´t judge taking what would you do as a basis LOL