This is incorrect. The correct pay structure for a trader is a member with a profit-split agreement. The secretary, janitors, and back-office functions/processes that are handled by hourly or salaried employees may be w2 or independent contractors based on whatever the agreement is between the firm/employee. The correct structure for trading profits is either a k1 (form 1065) if the trader is claiming the loses or a 1099 if the firm is claiming the loss. With a broker-dealer issuing a k1 you can claim up to $3000 in losses in any given calendar year. If you trade for a UK b/d, you have to report the income to the US as foreign income, I think 1040W. If you have a contribution and lose it, you won't be able to claim these loses. The same goes for if the firm issues a 1099 only on profits. In this case, your capital is at risk in the market without any government protections for losses you may accumulate whereas you can write off the first $3000 in losses if it's a broker-dealer and you are registered in a trader capacity.
you need to be quiet and get off your high horse. you have been crying about CY for yrs CY Group isnt ripping anyone off and never has. so just leave em alone
I agree. I know a few traders that were with them. It's probably not the safest place in america to keep your money but it's far from a scam or a fly-by-night shop. At this point, they've been around at least 3-4 years and there's no complaints yet as far as I can tell. That's not a recommendation to trade with them. Just putting out the facts.
I got started with Cy .... just a $5k deposit back in '07. I have since moved on, but couldn't have gotten started without them
cy group has been around for over 5 years with a good reputation they run a different business model for years traders should focus on trading & not worry about all the bs legalities being with a registered prop does not make your money any safer any firm can go out of business . your money is always at risk !
It's has less risk in a separate customer account in your name or the name of your entity. This would be covered by SIPC and not have the risk of commingling with other traders that you might not even know.
even if you are insured, SIPC has 99 years to pay you back, legally speaking. The odds of you ever getting your money if a large firm blows up is slim to none. This is true for all firms except the very few politically-connected prop shops like GS. If you want your $ to be safe, put it in a too-big-to-fail company. Big brother will always come to the rescue.
i would agree their are many ways to set up a proper stucture most prop firms took the easy way with registering with the cbsx or another exchange so they could mark up commissions legally always the commission based profit model these days their are fewer advantages for the traders or prop firms more hassle & higher fees for everyone with all the new rules implemented
yea, the profit margins are not sustainable for a small firm with 100 traders. only the firms with 1000s of traders will remain. Subgroups will eventually be regulated too and once that happens their costs will put them out of business. Again, the profit margins are too law. It's just going to get more and more consolidated. your $ is not even safe if its insured. These days you are better off just going overseas if you are a prop firm. It sucks that all the jobs in the industry are going overseas along with the $$.
the market will take your money faster then any loss from a prop firm traders have to accept taking risk in the market but also through the prop firm they choose to partner with so you have to do your dd always a certain degree of risk & all you can do is try to limit your exposure your money is locked up for 1 yr & getting paid once per month from most cbsx prop firms . most traders have to jump thru hoops , all for the leverage