i am the founder of a private non regulated investment operation that looking for some traders. what is an effective way to manage traders and the best way to compensate them and retain them?
Assuming you want consistency and predictability, you need to build a system to deliver that. Building such a system from scratch would seem very daunting. You might have a better outcome by learning an existing system, such as Goldman Sachs or Morgan Stanley, and then tweaking it to suit your needs.
u cant "manage" a true successful trader , its against theire nature , give them freedom , fixed income + bonus
i can relate to that. you are suggesting a salary and bonus based on what? i was thinking compensation on performance. what is are some good metrics? 20% of the firms performance fee that they contributed to generating?
Let me clarify that - you founded a company without having a clue how to run it? Hello, I just founded a wonderfull great restaurant. Anyone can explain me what a kitchen is?
It may seem odd, but many management level people do not know what is going below them. That is so common if you look around: your president, your congressman/woman, your boss, etc. I know HP computer company was run by a woman who knows absolutely nothing, nothing, nothing about computers. If you look at trading firms, you will find those who run a prop firm have no clue of trading. I picked up a commodity trading magazine recently and found a prop firm owner was called "a professional trader." And he was giving advice on trading!!! This industry is full of con artists. No wonder Bernie Madoff could run a hedge fund for decades of years. Back to OP, I see no reason why you shouldn't run a prop firm. Knowledge of trading is not necessary.
i am a trader who has significant experience trading, but not managing other traders. i am looking for feedback on what traders want from my trading operation when i hire them? what kind of compensation arrangements are typical?
60% and 40% seems fair to me you get 60% of the earning since you put up the risk capital and infrastructure plus maintenance cost. your traders are your workers. they earn their living by providing labor in this case is trading in exchange for the wage. you can be flexible with your super trader(s): 20% and 80% arrangement perhaps.