How much does it cost Bright or most Prop Firms to clear a transaction? For example, if Bright is charging .003 per share ($3 per thousand), is it costing Bright about .0003 per share ($0.3 per thousand) to clear the trade? thanks, Walt
Everyone who is anyone on Wall Street has at some point used the Goldman 360 portal whether for research, news, keeping a track of prime brokerage portfolio or, disturbingly, for trading, via the REDI Plus 9.0 platform (now loaded with enhanced algo trading features to make life for you, dear soon to be frontran Goldman client, so much easier). A second widely accepted Wall Street concept is that a disclaimer is the last thing that anyone reads, if ever. Yet after taking a close look at the Goldman disclaimer for the 360 portal, which is an umbrella waiver or all downstream websites, including REDI, one discovers the following gem: Monitoring by GS: Your use of the products and services on this Web site may be monitored by GS, and that the resultant information may be used by GS for its internal business purposes or in accordance with the rules of any applicable regulatory or self-regulatory organization. One second: by using Goldman 360 a client voluntarily allows Goldman to provide keystroke by keystroke data of everything the client does, even if that includes launching trades via REDI, to Goldman for the internal business purposes. The third thing everyone on Wall Street agrees on is that "internal business purposes" usually (and in Goldman's case, almost exclusively) means proprietary trading. Are Goldman 360 clients (in)voluntarily signing off a release to be front ran by Goldman on any portal-based trade? Could Goldman please clarify just what "internal business purposes" means in the context of this overarching disclaimer, and also whether Goldman has ever actually used 360 submitted information in the decision making process of its prop trading desk? Lucas Van Pragg: the floor is yours. Update: several readers have presented some other Goldman Sachs and Spear, Leeds and Kellogg form documents that contain an even more crypitc warning in section 4(f) in Use Of Services: You acknowledge that we may monitor your use of the Services for our own purposes (and not for your benefit). We may use the resulting information for internal business purposes or in accordance with the rules of any applicable regulatory or self-regulatory body and in compliance with applicable law and regulation. NOT FOR YOUR BENEFIT? I mean, come on, how more clearer does it need to get.
Great question. Don will prob. just stick to talking about envelopes and "openings" without any P/L that is verified over a long period of time. Point is dont worry about that stuff just pay them ! Thats what their deal is all about.... hence why they are "slashing rates"
I don't work at Bright and am still trading futures exclusively. so have no vested interest in being a defender of the Brights operation, but why in the world are they obligated to dispose their operating cost? It's fine to ask, but those that tear into them for not spilling their cost structure are nuts. Most businesses try to keep what keeps them in business quiet, as a matter of competitive advantage. Hey, I'd like to know what firms pay also, but none of the firms offend me by keeping it to themselves.
to maintain a high margin, they try to differentiate from other competitors by providing some useless education, association with GS, sponsorship, etc. I would definitely prefer a low cost broker rather than an above-avg one for things that don't matter much for my pnl.
I believe the person was asking what Bright's rates were with Goldman to get an idea of how much they were making on their commission charges. Brights rates are pretty clear from what I have seen. Don has posted them numerous times over the years, and posted a link to their rates when they lowered them this year. I don't think it could be much clearer. Sure they may offer better rates as you demonstrate volume, but I bet most firms make you prove your volume rather than taking your word for it. When I was debating going back to equities I called 3 places, Bright being one and was given a quote of what Don had been posting at the time. The other two places gave me two different quotes the two times I called. Not only commisions, but fees changed too. They are both fair size firms with good reps, they just don't come on ET and promote or help out.
OPINIONS or REVIEWS ON THE FOLLOWING NEW PROPS: ESRQ CAPITAL (OCEANVIEW) CAPITAL TRADERS GROUP (BROAD) PTG SECURITIES SPIRE TRADING GROUP (MADISON) XERXES (HOLD)
and where do you have any evidence whatsoever that shows GS's prop trading division(s) has/ve access to agency trading information? This is clearly illegal and the last time GS was sued for that and there was hard evidence presented before law court is so long time ago I dont even remember. Care to refresh my memory? I am not claiming GS is squeaking clean but lets stick to the facts not what people think, heard, believe...
I bet the cost for the prop firms is is in the neighborhood of 0.2/1000. Here is my reasoning: 1. Lots of traders do not make money; 2. Quite a few canadian firms offer 0.2/1000 with profit split. 3. So 0.2/1000 should at least cover cost if traders make zero profit. GS might be a little bit more expensive. Most Canadian firms are based on sterling pro. Having said that, I am not saying Bright's rate is high or low though. Bright does offer capital at competitive rate and leverage, especially for overnight position. For example if you trade pairs for a longer timeframe, Bright is actually a very good place. As to the cost of capital, I doubt Bright is subsiding its traders for the cost of using leverage. The interest charges for leverage is probably a pass-thru from GS. Bright however needs a large deposit from GS to secure the leverage for its traders. Please correct me if I am totally wrong.