How does the accounting work? Do I get a statement and do they send the year end stuff to the IRS and me for USA tax reporting? Michael B. P.S. I know, I know, I am responsible to report global income because of my countries unique tax laws.
Not real sure about the statements, I would assume you get one but not really sure. You should probably email the company directly with that question: trading@alldaytraders.com They are not a US broker, so they will not report anything to the IRS. It would be up to you what you report. The IRS will have no idea what you did or did not make. I guess in theory you could probably not report anything, although I am not advocating tax evasion. My friend was telling me something about it being a foreign investment so the rules are in some way different and you might be able to write off more than the $3000 loss cap there is for US trading. I guess a knowledgeable accountant could help you with the tax ramifications.
daliddleguy: Yeah, I saw that too and was about to right them off but then I noted that they have a "Plan B," which is a standard per share commission -- in this case, 1.5 cents/share (+ ECN fees + something called a "software fee"). That's more than IB and MB Trading (where I'm at now), but the ability to get around the PDT rule may outweigh the added costs. --TD
daliddleguy: Actually, you could be right -- I may have misread their commission schedule. They say "$7 minimum," which I took to mean "per month". If it's "per trade" then forget it... --TD
I mentor a young BBA graduate. He doesn't have enough cash to daytrade equities, yet. In the meantime he is working to save his US 25K and training on a real time simulator each day when NY opens. He is taking multiple courses to enhance his knowledge of markets and finance. And he's got a job. His 25K is so very hard to save that he will have true respect for it when he begins to trade live. Its a slow process, but this guy will make it. No short cuts, just lots of smarts, determination and guts. The new breed of daytrader. He knows a dozen ways he could short circuit the system and start trading now, but the guys too smart. Because of the time zone we live in, he will be able to ease himself into the market slowly when he is ready. Short cuts like the ones this offshore firm offer are a guaranteed loss, and aimed at taking advantage of those who think this game is easy. Can you imagine paying 8.29 each way to trade 100 shares? Forgetaboutit.
Why do you traders running into problems with the $25k pdt rule not just open an account at a prop trading firm? Most of them will let you start with only $5-10k and give you way more than the 4:1 buying power the sec limits you to. All you have to do is pass an exam or three, and they're not hard, just require some study time. No fdic deposit insurance, but if you go with a solid firm, that's not really an issue. The commissions are the cheapest you'll find anywhere, you get good software, can trade from home or office, all the places I've had dealings with will let you hold overnights, etc. I mean, really, it seems like such a no-brainer to me, I'm surprised every time I read threads like this one.
Yes there are many ways to get around the PDT rule, and prop firms are one of them. Its not the exams, its that a lot of traders don't want to deal with props, and some have very good reasons. That said, Props have their role, and are an excellent idea for those, particularly American traders who might otherwise be tempted to use a carribean broker.
I'm not sure, but I would assume the commissions are somewhat negotiable. Also, I bet part of why the commission rates are on the high side is because they are offering something that basically nobody else can (except prop firms). I mean where else can you day trade all you want with less than $25k?
You should be able to earn the equivalent of your parental allowance. That should be enough after you graduate high school, right?