Hi folks, I have a highly profitable futures spread trading strategy and I'm looking for a prop firm that accepts BC Canada residents for remote based trading. Must allow overnight positions as well. I can fund the account or do profit splitting. I trade CME and Cbot futures. PM me or post here if you know of any. Thanks very much,
There's a lot of leverage already in futures and margins for some spreads are often reduced (Bone could probably talk your ear off about it.) If you're prepared to put up capital for a prop, why not just go direct with a decent futures broker?
I agree with Jack completely on this. The SPAN initial margin credits for carrying spreads overnight is so exceptional, it certainly sounds like you could easily do this for yourself. I have clients carrying a dozen different flavor, genus, and species spread positions overnight for less than $10K in margin. Pairs, Flys, Condors - energy, interest rates, equity index, all sorts of commodities, you name it. Prop Firms will generally speaking not offer you any value added. In fact, there are some real downsides to the arrangement. Been there, done that. Are you prepared to get smoked with fees and commission haircuts, then split your profit, and then get paid as a W-2 employee and taxed as ordinary income ? I know you are Canadian, but it is a point to consider. I mean, I have a client who started with $25K in 2010 swing trading futures spreads while keeping a "regular day job". And now he is seriously talking about quitting said "real" job and trading full time. I really cannot say that if he had gone the "prop" route that he could have made such progress any faster. But he certainly would have had some principals at a prop firm looking to snake his trade. I personally do not know of any futures prop firms that accomodate remote trading for new hires. Traders with alot of experience and a long track record with that particular firm can sometimes do it and I know of them, but it is more of a rare legacy accomodation.
Thanks for the replies. One of the reasons I'm looking for a prop firm is to pay lower commissions. I have a high turnover and I'm spending hundreds a day in commissions. I know I could pay less with a prop firm that has cme membership. Also I need a more professional platform such as Xtrader or CQG. Currently using InteractiveBrokers. And it sucks. I need an autospreader to make my job easier. Also living in BC makes it hard to be accepted by a lot of futures brokers. The selection is really limited, and the commissions rates are roughly the same as IB maybe a tad cheaper at some brokers.
if you are doing hundreds in commission a day, why not shop around? many brokers will give you a better price quote if you give them a decent volume estimate do enough volume, and leasing a seat yourself for the commission break might even be worth it
I forgot to mention that I also want to go with a prop firm for additional leverage. The margin amount I use is still pretty high and since i'm quite hedged its ok to take on even more leverage. Does anyone know if it's possible to negotiate with a broker to put down say half of the cme overnight margin amounts, and they lend me the rest. Most of the time I can be flat or have a small position going into the overnight but once in a while I have to carry a full position from the day into the overnight but like I said i'm hedged and never even sweat when I have to do that.
A broker, a true FCM ? No way. Not with futures. I think you might be confusing the roles of an FCM, a prop firm using an equities trading business model, and a futures prop firm with membership at a major trading exchange. The latter one is the one you are looking for it seems, and by exchange rules they as member firms cannot take client deposits and they have to pay you as an employee on a W-2. And I have never heard of a proprietary trading exchange member firm taking remote traders. If anyone knows anything to the contrary, please by all means speak up. Expect to move to Chicago or New York, and if that is a problem for you then the futures prop business model is not going to work in your case.
Bone thanks for your informative post. Living in the states is not an option for me anytime soon. It's a wild shot but maybe I could go to Chicago and trade for firm briefly and then go remote. If not then I have to find myself a new broker. But that wouldn't solve my need of additonal leverage and much cheaper commissions. I shopped around for brokers that accepted BC residents and nearly all their quoted commissions were the same as IB's more or less. Not enough to make a significant net profit difference. Deep discount futures looked like a good match with their low commissions and xtrader and cqg platforms but they told me they didn't accept canadians anymore. If anyone can show me a broker with similar rates to deep discount futures then it may be worth it to switch. I trade about 50-75 lots a day. Not huge size but definitely increasing every month. I still think there's got to be a prop firm somewhere that would accept me.I don't care if I get paid as an employee and do profit split. Top prioroty is that I need more capital. My strategy is highly scalable and can easily do 10 times the size.
Probably no U.S. firm will accept a British Columbia resident because it is illegal under B.C. law now. Not Canadian law, B.C. law. Many firms will accept residents from other Canadian provinces that are not as restrictive in their legislation. However, ask RJO Canada to match the rates of DDT and they may well.
Are you referring to strictly brokers or also Prop firms? Is there some way to circumvent the BC laws by opening a bank account in Alberta or Ontario then doing your business through that bank. I would like to avoid setting up a corporation or other entity in another province if I could. But I don't want to do anything shady.