I am not well versed in what happened at TUCO except for what I read here, so take this with a grain of salt. TUCO seems to have had two big problems. First, they were not a broker/dealer. Second they misstated their capital. We are a broker/dealer and are regularly audited. Most firms you read about here are not broker/dealers. They are 'sub-llcs.' This is a very grey area and is what I believe the SEC is cracking down on. We are very, very careful when it comes to regulations. We have no interest in being the typical commission-churn shop. We have positioned ourselves to appeal to a small number of well-capitalized independent traders. We have a very strong capital base and have been in business since the early 1990's. One last detail worth noting is that my partner, Mark Duffy, is on the Board of Directors of the Chicago Board Options Exchange and National Stock Exchange.
If it doesn't work for you it doesn't work. I am not going to try and convince anyone otherwise. As I mentioned before we use Sterling, ThinkorSwim and TT. We are very happy with Sterling. There may be better platforms that target a specific market, but in terms of all-around quality we like it a lot and have had great success with it. Just my opinion- YMMV.
Let me rephrase it. Are you getting around traders needing a series 7 by having the traders trade out of one large LLC master retail account that they are a memeber of?
[I assume you mean our MTO (member trader organization) business, not our prop business... ] We think we are somehwhat unique in what we are trying to offer. You are correct there are 100's of sub-llcs and llcs. Most follow this model: Recruit 20 traders with at least a couple grand in their pocket. Promise to train / teach them. Maybe offer to charge them for the training. Put them in front of a computer and have them start trading. After a few months you have one of two outcomes (assume strong risk control). Nineteen traders lost all their money with 80% of it going to the firm as commission. One trader makes it and you get on-going commission dollars from them. Recruit 20 more traders.... I have no problem with this model. Everyone should have a shot to be the 'one' guy that makes it. However, if you already know how to trade and you have $100,000 not $10,000 you are looking for something a bit different. That 'something a bit different' is what we are offering.
We are not getting around anything. Our regulator does not require a series 7 for members. It is really as simple as that.
Oh ok, now I understand, you are an exchange BD with the CBOE, that is why your traders don't need a seres 7. Thanks for clearing that up. So you are similiarly setup as VTrader, where traders don't need a license with your BD as they do with Bright or Assent.
You're making an incorrect assumption about the industry. There are plenty of firms that appeal to experienced & newbie traders. They are a dime a dozen. Hence you are not offering anything different, based on your answer. Just another prop firm, which is very late to the party. I'm just wondering why anyone would bother investing into this played out business model. Is it that hard to be innovative and think outside the box?
please clarify something steve. it looks to me you're looking for guys with there own money that open retail accounts threw you and pay 1k a month to get lower commissions under your umbrella. is this correct? do the members paying 1k a month open sipc retail accounts?