I am trying to partner with a university close to where I live, where Finance major students can come and trade 24hrs 5 days a week. I already have 75% of the infrastructure required. They will be using my funds to trade, and learn at the same time. My question please, is how can I make numerous accounts for these students. I currently have my own personal account with FXCM. I already have a registered corporation to handle this. The aim is to make them learn trade but also make money for the corp. I will donate a %ge to the university thereby I will be a training facility according to the IRS code. Usually the trades will be trading the news. No long term trades. If anyone has a knowhow how this might be a feasible idea. Please any feedback will be greatly appreciated. BaNgidha!
Be VERY careful. If you ask to any experience trader if the degree that they hold gave them an edge while trading, most of them will tell you that it did not.
If you are not already a very successful trader, I'd suggest you just donate your money to the university now. Will save a lot of wasted time and effort.
Starting them off on a demo account (paper trading) might be a good idea! Speak to FXCM about opening sub accounts to your main account, it's an easy process for most brokers, you'll probably need to sign a Limited Power of Attorney (LPOA) which allows a third party to trade your account. As others have said this really isn't a very good idea, finance majors have just as little chance of being profitable as the next guy.
I teach at state university and one of my classes is something like this but with stocks. Our benefactor does it entirely as a charitable endeavor, donating ALL the profits to the university and making up any losses suffered by the class so we have a constant amount of investment capital. My experience is that most finance students, be they undergrads or even grad students, do not have much if any trading experience. Occasionally I get day traders but they too rarely have what I would guess most of us consider to be "solid" trading skills or the right temperament. So if you want to do this as a money making venture you are probably better off trading your own account even after the tax implications are considered. If you are doing it for more philanthropic reasons, more power to you and I would imagine it is only a matter of getting in contact with the right professor and administrator. If you post WHERE you are located I would be happy to let you know if I know anyone in the area who might be able to help. Otherwise, good luck to you!
Absolutely crazy. Unless you don't mind losing the seed money, run fast. News trading isn't the free-money handout it used to be. Spikes, bad fills, quote freezes, WIDE SPREADS, gapping prices. With FXCM, no less. FXCM is renown for all of the above x10 during fast markets. This isn't very well thought out. If you want to trade news, go with a retail ECN (MB Trading) or real ECN (Hotspot - low account minimum). This way, if you do succeed, they won't put you on manual execution. Which FXCM, again, is renowned for. Good luck.
News Trading. LOL. That has gone the way of the dinosaur. Most likely, you will not be filled during news, and they also widen the spreads so much that it's not even profitable.
BaNgidha, Don't know if you're around to read this, but the precautionary advice given here is definitely justified. If you are training students to trade your current methodology, then don't make the mistake of letting them trade your funds before they have demonstrated that they are able to follow directions. It takes plenty of discipline to manage emotions in trading, as I'm sure you are aware. I personally believe that futures would be a better option. Even with an ECN, you don't have as level of a playing field as you do in futures. That aside, if OTC forex is what you decide to do, then consider raising equity from external investors while you screen prospective traders. Get enough capital together that you would be able to access institutional level forex trading services. I'd also advise you to add to your screening process the requirement of a significant capital investment from your traders. It won't necessary make them better traders, but it could give you an added degree of protection against the inevitable losses that will occur. I am curious about your comment about having the infrastructure setup. What exactly have you done (other than what is mentioned in your post)?