Legit or no?

Discussion in 'Prop Firms' started by ksmetana, May 25, 2012.

  1. I found a firm that does NOT require a series 56... trading STOCKS.

    They require NO capital up front. They absorb the losses. They limit their risk buy starting you off really, really small, and increasing your BP as you show consistency.

    So, what is the law exactly on the 56?

    Do you only need to take the test if you are contributing capital?
  2. If they are paying you a salary vs. you making money from your trading, then they may be ok. Sounds a bit odd, in this day and age however.


  3. rmorse

    rmorse Sponsor

    Is the firm a broker dealer or trading as customer? If they are not a regulated entity, you are not required to be licensed. Either are they.
  4. The 56 applies to traders who join firms registered with CBSX, whether you are contributing capital or not.

    Some additional questions you may want to ask:

    Is there an "education fee" masked as a capital requirement?

    Is it an offshore firm that allows for remote trading?

    Are you joining as an employee?
  5. LEAPup


    OP, if you're talking about broad st securities, they're offshore. Big fees too. Be careful.
  6. Ill have to ask why they don't require a license, pretty strange.
  7. hitnrun



    With no capital up front ?
    sound like a bs line they gave you , they are going to require capital from you

    sec rules apply to firms based in the us only !

    gl in rolling the dice with any shady firm skirting the rules in accepting a us trader
  8. just take the test and put up your capital.
  9. They say you do not need the licenses because you are trading their capital and they are taking all of the risk.

    Basically, they start you off really light, and increase BP as you gain consistency.

    80% payout

    Trader is NOT responsible for negative months.

    .0035 commission, ECN pass through to trader
    Data fees waived for first 6 months

    I suppose they use commission to earn extra money off your profits.

    I dont know, I've been in the prop sphere for 2 years now and this is the best setup I've seen... this is how it should be.
  10. Sounds good to me...
    #10     May 29, 2012