Is experience at a prop firm required to be a successful retail trader?

Discussion in 'Prop Firms' started by gambleditall, Sep 27, 2018.

  1. Hello everyone,

    I started by journey in trading crypto around 6-8~ months ago. I started with 20k and got into Bitcoin at a price of 15k - quite close to the peak of the bubble.

    Obviously I did not know what I was doing initially but using mean reversion trading, somehow I was able to not lose much of my account - I'm at 18k right now. For the past 3 months I have been educating myself about trading by reading book after book and have learnt about trend following / risk management / record keeping.

    However, through watching the Youtube channels of other crypto traders I got knowledge that I could not have learnt even if I read each and every book on trading. This is knowledge that I would have no idea even existed (stat arb, correlation trading, sentiment analysis etc) if I wasn't informed of it by these Youtube channels.

    Similarly, I am sure that that even for equities and options trading there will be knowledge that I do not even know exists.

    So the question is, to be a good retail trader who intends to stay in the game and make money consistently, is it necessary to work for a professional prop trading firm so that you can learn about this stuff or can you be a professional trader just learning online?

    Cheers and thanks for the replies! :)
  2. atawil



    most prop firms will not care about teaching you , they will just charge you monthly "desktop fees" and the one who have education if you want to call it like that charge you a lot of money, for materials is available online. to answer your question no prop firms will not care about you and how you develop

    if you want to learn from honest successful traders
    try those

    trade your money with micro lots until you know what are you doing which should take some time keep them micro lots.
    don't waste your time on demo trading.
    dont pay for education
  3. I was specifically talking about firms like DRW where their profit is based on the performance of the traders they employ.
  4. atawil


    if you can go to their office location give it a go.
  5. I'm trying to find out from people here who may have worked at a prop firm previously to find out if they teach anything that is different from what you can learn online.
  6. atawil


    if you work remotely then you will learn nothing.

    if you work in an office dealing with other traders or staff then yes ofcurse you will learn some of their strategies or at least you will have a real mentor

    I have only experience in working remotely which most or all prop firms wont even talk to you.
  7. I am referring to working in an office as a full-time employee of course. Remote is very different.
  8. atawil


    I have no experience in working in office but as I said give it a try if tis in an office
  9. canoe


    the types of trading that prop firms like DRW, Akuna, etc. do are totally different and usually inaccessible to retail traders. these firms usually leverage their structural advantages to create trading strategies employing HFT, spreads, stat arb.

    obviously you'll learn a lot by working at these prop firms but the experience won't necessarily translate into making you into a much better retail trader who is mostly gonna engage in directional plays. as a retail trader, you won't have any of the structural advantages necessary to utilize the types of strategies you'd learn at these prop firms.

    i think working at one of these firms would be a tremendous experience for different reasons but to answer your question, i'd say it's neither necessary and certainly not sufficient to become a successful retail trader.

    not to mention...prop firms like DRW only hire entry levels from IVY/MIT/Stanford/Chicago/Northwestern with a math or stem degree. they do hire experienced traders too but i know for a fact they are gonna look at your 6-8 months of crypto trading record and laugh at your face. they require at least a minimum of 3 years worth of track record and they could care less about how much money you made. it's all about what your returns were on a risk adjusted basis.

    hiring for discretionary trading is almost obsolete these days. there are some lesser prop firms that may give you desk space if you front your own capital or "pass a tryout test" similar to the TST combine but i would avoid them like the plague.
    S-Trader, comagnum and tommcginnis like this.
  10. Thanks that makes a lot of sense.

    What are the 'structural advantages' that you are referring to other than access to large amounts of capital?

    You mention that working for prop firms will be a tremendous experience for different reasons. Can you elaborate what reasons?

    Also, why should retail traders be limited to directional plays and not include stat arb / correlation plays and spread trading in their toolset?

    If hiring for discretionary trading is obsolete, why are so many people on this forum or otherwise still engaged in this activity? Is it just all gambling in that case?

    What are the skillsets that a retail trader should focus on other than chart reading for directional plays?

    I know its a lot of questions but would be helpful if you can answer so I know what path to go along since I am working without any mentors.

    Last edited: Sep 27, 2018
    #10     Sep 27, 2018