Seriously? 80/20 and there's still a deposit? Still sounds like a customer model to me if the trader is at risk of losing his own money.
That is not the spirit of the regulation motivating the 80/20 split in the first place. Unless you folks are designing some workaround where the trader also shares in the profits of the firm, the standard model is going to be gone if/when the SEC weighs in in its official capacity.
Or rather, I would, but under a totally different structure. Commissions, risk capital, losses, leverage would all have to fundamentally change from the past models. At least for experienced traders. Rookies, 80/20 probably makes sense. I thought all the props used this as the starting point...
Sure there is probably a lot of things Don is working on right now as we speak and every one of them cuts into his operating margins big time. The pie just keeps getting smaller and smaller. Don is the equivalent of a buggy whip salesman that that refuses to accept the concept of the automobile.
maverick-----just curious? what do you do? derivatives? do you believe day trading is finished for equities
I trade futures mostly and some options. I don't think equity trading is done at all. I think equity prop trading is finished for good. At some point people like Don are not going to be able to find a way to justify the risk for such small margins. It's just not worth it. Now, as I've said before, the Brights have capital and maybe they will create a new firm that will operate more like a hedge fund where they all trade for p&l. You know they teach all these guys how to fish, let's see if they put their money where their mouth is and see if they can actually live off the fish they catch, not their commissions. Mark my words, the commission model for equities is over.