I like the fact that StockStalker brought up Neve's performance because it also demonstrates the other point nicely. At the end of last year Neve had $336,000 in his account. If he had worked a job just to make the bills during that time and only withdrawn taxes each year, he would've ended last year with $1.5MM in trading capital. Those withdrawals really hurt when you look at the whole picture.
First you have to truly understand the difference between 'account size' and 'performance bond margin'. You also need to understand how drastic the leverage and capital efficiency disparities are between the two, and how unrealistic it truly is to try and make an ROI performance comparison between the two prop business models. You say you do, but apparently you really don't. Can you do this? Can you teach me how to do this in your mentoring program? I am interested to learn more. [/QUOTE] I will not take you on as a client. Legitimate prospects act in a professional manner and contact me directly. Also, my clients are typically trading professionals who understand how futures performance bond margins and return profiles differ from the equity space.
The key here is methodology before anything else. Anyone may put in whatever they like as sufficient capital BUT unless and until you have a consistently successful methodology you will be going nowhere and likely losing all, or badly denting, your input capital. If you take those at least 5 years on ET they're only a small proportion of all those talking the talk on current ET threads. A few do learn something over 5+ years (or sometimes less) and appear to make money from trading the market. I would put a low number on the capital you need as an amateur newcomer. What you do have to find or adopt, though, is a winning methodology. Unfortunately this requires the savvy and patience which is usually not supplied by most individual newcomers. Almost all ET threads in their entirety show just how much ET members don't know and they're mostly not close to remedying that. Why? Its because there is not the patience. You have to do the time - no matter if it takes you years.
I know Chuck McElveen personally, so I guess that I do have some insight into what was the Kingstree Business Model. You're the name dropper, not me. I was a Chicago prop trader for several years myself, and I have clients who are currently Chicago prop traders. I have clients in the UK and Gibraltar who are prop traders at Schneider, and I have Australian clients who are prop traders at Silk Road. I have two clients in Singapore who are prop traders. Bone, that's not dropping names? You just dropped a ton of names. I only mentioned what Dr. Steenbarger, a former close friend of mine, and highly visible blog author posted numerous times as an answer to this question. You implied he only worked with equities traders. But, his blog and most of his posts were geared to futures traders. Perhaps, I read what you wrote wrong but it sounded like you implied he didn't understand futures. I'm going to be honest with you bone. You sound like you drop into threads just to come across as an expert -- dropping names, saying a bit here or there. Bone, now you are really backtracking! I pointed out that that the minimum margin requirements did not represent the minimum account size!! I pointed that out!! Now, you backtrack. Is it because you can't even meet the what you claim "the average prop trader" makes? Bone, if you aren't the typical scammer you'd quit dropping names and start producing records. And let me say, I would still consider to take your mentoring, if you produced some verifiable records. I don't really like your personality and the way you come across. But, I'm always looking to learn. Let's be real Bone, I don't suspect I'll be taking your mentorship anytime soon.
Or maybe I should just keep trading small size and working until I have about $100K saved up Even Bradley Cooper in Limitless only wanted to borrow that amount from the Russian... I guess I'll just trade and work for the remainder of this year! DAMN! 9 more months to go...with 20 vacations days! Gonna be hell!
Gcap: I think that's a good plan. You know when you need to quit working when you can't afford to work anymore. I want to point out what Bone did though because it was very weasely behavior. 1) He implied that the 100k estimate Dr. Steenbarger quoted didn't apply to futures. 2) He referenced the minimum margin requirements as evidence that large capital requirements didn't apply to futures. 3) He claimed that the average future trader could make a profit every single day, on average. This seems peculiar to me as many futures traders lose money. He juxtaposed the minimum margin requirement next to a 3-4k income. Facts, 1) He admitted he had no verifiable knowledge of what other futures prop traders were making. His knowledge was hearsay and rumor. 2) When I pointed out that minimum margin and minimum account size requirements differed and asked for clarification: instead of clarifying what he meant, he did a personal chop attack on me. 3) I asked if he taught edges that would allow one to do what he claimed the average trader could do. His answer was that he couldn't take me on as a student because I didn't understand the difference between minimum margin and minimum account sizes. It was obvious I did have some understanding of the differences. Moreover, it is peculiar why he even mentioned the min margin requirements if they weren't relevant. At ant any rate, his answer was a resounding no. Thanks. That's all I needed to know.
Calculation based on my experience (Switzerland): Consistent performance with reasonable DDs around 20% p.a. is realistic. More isn't. Business fees (company, legal, IT, audit,..) about $100k/yr. Salary: I need at least $120k/yr to live here. So if I charge 1%/10% I need about $8M aum. And I'm not counting taxes nor buffers for worse years. Ninna
15 years ago a parent of mine had a health issue so asked for a leave under FMLA for 3 months and traded well those 3 months. When it was time to return to work I asked for another 3 months -- personal leave and it was granted. Continued to trade well and never went back even though they wanted me back badly. If you're serious about trading put together a business plan as well as a "what can (will) I do if I fail at trading". It was a good motivator for me.