In Bright offices, the head traders get a small cut of the comissions of traders in their office. In the short term, you're right that they are rewarded for encouraging their traders to churn. But I think that most of these head traders understand that, if their trainees become profitable and consistent, then the trainees will stick with it, trade greater size, and trade more frequently, making the head trader more profitable. From my own experience, the trainers would encourage trainees to start small and to focus on profitability before stepping up. This may not be in their interest in the short term, but it goes to show that Bright traders (or at least the head traders I met) think in the long term.
Yes, and please understand, when I say that top traders don't really want someone sitting next to them, I don't mean that they aren't more than willing to help. Since 90% of our training is all done here in Las Vegas, where everyone in a training capacity is incentivized to help the new people, we don't encounter that problem as much. In fact, I think that our long term success is primarily based on "traders helping traders" - perhaps not "sitting right next them" (hard to do with 25 newbies at one time)...but with hundreds of hours devoted to helping. From us "old gezzers" to the "best traders under age of 30" - we all work together in the best interests of the traders. BTW, all new traders are encouraged to start small, become consistent, then move up in share size (actually all boot campers are now limited to 501 shares until approves otherwise). And BTW#2, we waive desk fees for boot campers now as well...we are always listening, and even though some things may be hard to hear, we do our best to adapt to the traders needs...while still maintaining a solid, stable, and financially secure place to trade. Don
Oh boy, Do I feel dumb after reading that beautiful bootcamp stuff. Only 4 weeks to get you somewhere, with or without churning. It took me many years on my own before I felt that I got somewhere. (I don't even dear to state the exact number of years anymore). The main thing I learned, all by myself though, is to sniff out them snake oil vendors. nononsense
Well personally I spent a couple of years learning on my own before I'd had it, realized I needed a mentor, and shelled-out $250/mo to join a pay chat room. In the 30-60 day timeframe I didn't need it anymore and the cost was exceedingly well worth it...in fact, if I'd gone that route early in the game it would've me saved a few 100k.
I think the "nonvocal majority" had doubts about the effectiveness also. I talked with most of the class and nobody was breakeven after commissions and the desk fee. Students were asking each other what they should be doing after the openings. Most the students were losing money from the openings when they started using size (1000 shares). Slippage will increase and performance will be worst when you move from 100 to 1000 shares. You don't include commissions in your results for the bootcampers. All the +2 +4 cent people on 100 shares you counted as wins actually lost money with commissions. All the Redi machines are setup so they do not display commissions in the P/L. Here is an example from someone who sent me their screenshot after bootcamp. Guess how much money he made? 22k shares * 0.0125 = $275 commissions Pretend he got his S7. 22k shares * 0.01 = $220 commissions Sorry to say but Opening Orders have lost their edge and the commissions it generates is excessive.
I'm going to be fair and show a positive picture the same person sent me before he raised his size to 1000 shares. His email read: "I guess this is how Opening Orders are supposed to work. The BP and XOM trades were an overnight hold, but the rest were openings. 13 out of 15 winners! Why can't I do that every day???????????" Let's see. 401 - (165 for BP/XOM) = $236 6000 * 0.0125 = $75 commission $236 - $75 = $161 Gain for Day!
I'm going to be fair and show a negative picture the same person sent me. His email read: "8 out of 12 winners but a losing day. Two reasons why: 1) I wasn't quick enough on USB, just missed getting out with a quick profit 2) Held some longs too long in a sinking market" 26k * 0.0125 = $325 commissions -390 - 325 = -$715
No one expects boot campers to make money right out of the gate...sure, some do....the results of the openings prove that if they all stopped at that point, they would be overall positive for those days.....but this is instructional... Students need to do their homework, take advantage of being exposed to several types of trading...at a very low all inclusive cost (no extra fees for one on one training, or Rob Ffriesen from PairCo)....there is no more desk fee during boot camp. Having just gotten off the phone with a boot camper from last year (he called to thank us and to ask some questions about a good next step)... and having traders in this office already making money (net, net) in the first and second months, I feel pretty comfortable that we're doing things "as right as we can"... It takes time to master trading, and since we can help speed things up, it should pay off in the long run. (BTW, anyone can set their P&L to reflect commissions if they want to)....and, since we now limit bootampers to 500 shares (without permission), they won't likely get too carried away again, something that is the responsiblity of the trader). We have increased retention and trader prifitability via this training, and that sounds like a "win win" to me (I hate that term win-win, sorry)...but it applies. As far as the students not "knowng what to do after the openings" - I take exception to that...they are given specific direction, if they choose to ignore it...we can't force them to do it. I try not to bog them down in too much homework, but....(whoda though)...those who do the most work, make the most. All the best, Don
I found the most positive email picture in my mailbox from him after he raised his size to 1000. His email read: "8 out of 10 winners today. This is very encouraging. All I need is my Series 7 and I'm on my way!!" 18k * 0.0125 = $225 commissions $460 - $225 = $235 Gain for day!!! You should be able to learn a lot from all these pictures, how good the OO strategy works and how much commissions it generates. Don is actually a really good guy but sometimes the things he writes gets to me when he doesn't tell the whole story. I'm not going to post anything else about Bright from now on. All the Best, Bye!
I'm not as informed as the rest of you, but maybe Don can clarify this for me. Is it not true that the commissions are capped on a trade at $25.00 at Bright ? Whether I'm trading 5K shares or 25K shares I would only pay top commish of 25 bones. This is either TRUE or NOT TRUE and if of interest to me so please someone help me with this one. thx