Could be they will tech you basket sector trading where your 200 share limit will be extended to a group of 3-10 stocks. You have to keep in mind, that the most profitable strategies will be provided (profitable to the firm). As long as they teach you the right way, and you make money that's fine. I doubt they will spend time teaching you how to swing, that you will have to learn on your own. shneed
prop firms want people to scalp, so i would say that most, not all people working at propfirms do scalp. but with a 200 share limit and paying .02 a share it would be almost impossible to scalp, but it will be a great learing experience for you, you will be able to get a lot of your mistakes out of the way for free, which most people don't get that luxuary, they usually end up blowing about 25-30k, are they letting you hold positions overnight? i would imagine that would be something that would be up to your mentor. you basically have nothing to lose and a lot to gain by doing this.
did you say if you are signing a contract...if so for how long? sorry i disagree with earlier posters, 2 cents a share and a 60-40 split is a death warrant. if this changes after 6 months then that is a different story. what is your mentors methodology...is he a scalper? that's what you will be learning. what is his profit/share ratio? do the math......take his p&l and figure out what it would be with your structure. if you like the outcome go for it.
Don't think he mentioned a contract, Carlin isn't stupid! Are you saying ECHO trains, requires no capital, and charges .005 a share?
a death warrant for who ?? he is putting up NO capital. it is a no loose deal, no matter how you look at it. best, surfer
if he loses money, it's not his money, either way if he's on his own or w/someone if he loses, he loses, w/Carlin he doesn't have to lose his cap? the deal isn't great, but it's not horrible for a newbie w/no cap. the problem here is some people are looking at this w/their current situation, no experienced trading would take this deal, but if you were new to the game, had a chance to learn from an experienced trading at no charge to you wouldn't you do it? he's getting live trading experience for nothing, you can't beat that, chances are the first couple of months he will probably lose, i'm sure Carlin knows that, that's why he has a 200 share limit and a mentor to help him out, personally i think any firm who doens't require any cap, is willing to train you with no fee and shares the profits is a great deal for a newbie, who cares about the commish and profit split right now, would you rather go to a different firm put up 10k of your own at your own risk, might, might not get someone to train you, you might get a little cheaper commish, but if you lose it's your money and when it's all gone your out?
Just kidding about the vaseline! If you have a mentor who's consistently profitable and a good trainer, then it's a good opportunity for you. Stick with it for a couple of months then try to negotiate a better deal or else jump ship. Just keep in mind that you won't make money for a long time, especially with those high commissions. Make sure that you have savings to last you for about a year. Personally, I think putting up capital for low commissions is a better deal. Most important is having a good trainer. When you trade your own money, you either learn proper money management quickly or you flame out. When you trade firm capital and are not personally responsible for losses, you're usually not as disciplined and tend to develop bad habits. That's why I've seen many good hedge fund traders and market makers suck at prop trading. They didn't have unlimited capital and long-term position trading (plus order flow) to bail them out of their mistakes anymore. There are exceptions of course. Maybe you'll be a quick learner and develop solid discipline without putting up any cash. I've seen that, too. To each his own. Make sure you know that your mentor will be committed to you. A lot of great traders make lousy teachers and vice versa. Just my two cents.
wow... haha this is quite nice.. everyone arguin both for me and against me =P thanks for all your responses... it's throughly appreciated. anyhow to answer everyon'e questions. let's see.. i have a 6 month contract. after tat depending on performance and my mentor's beliefs, i can be signed for two years. preformance doesn't even mean i ahve to make money though, it just means that the trades I made were at least good and I could back them up with logic. As far as I understand it, I have one main mentor, he makes 7 figures and he has been trading for 10 years or something like that. He seemed real nice when I met him and myself along with 8 others will be under him for 6 months. Also in the firm are 20 other traders that make 7 figures with whom I can consult with. On top of this, I have about 20 others that make around 30-50 k a month on avg. The generic I interviewed with says that they have a great belief in their training system. On avg they keep 70% of the people they hire, while they said most prop firms fire 70% they hire or more. What else here.. let's see. oh yes when i become senior trader, a lot changes. FOr one thing, i think it drops to 1 cent a share, i'm not too sure tho. one thing that is for sure is that i make 90 / give 10. the senior trader title is given upon performance, not time. you can have it within 3m onths, or as long as 1.5 yrs before u get it. oh i forgot to mention, i can only trade NYSE stocks in the first 6 months, and anything after. basically in the 11 wall st. Generic office, they have a firm belief in their system as i menitoned. and claim most ppl become profitable within 6 months. also they are against scalping cus i remember my boss mentioning he really doesn't like ppl trying to make a few pennies off a trade, i think that might be why they have such a high commission at first. if any of you have anymore great advice or just comments, feel free to post! thanks!!
hey if all of this is true then go for it.... 6 months is not that long and will give you time to learn. i just didn't want to see you locked into that deal for a couple of years. when i got into the business i had a pretty expensive cost structure. then they tried to shove an even worse deal on us after the first year. anyways, good luck and keep us updated on your progress.