How is the downside limited? I missed that part in the pretty colorful brochure. Maybe it was next to that ad for swampland in FL.
No because if you increase your trading size they will ask you to increase your part of the deal also.
LOL... My guess is the downside is even worse than these guys are willing to admit. Assuming a high water mark, the investor will get paid over that water mark while not sharing in losses below it. The investor keeps that PnL no matter what; they don't share in any of the drawdown!
Lol I actually made money on Florida swampland. Gramps bought it back in the day and was part of his estate. Developers came in and dredged the whole place. But that's a story for a different day. I guess nobody reads others posts here anymore. If you give ur money to someone else and the cash is not in ur name, you have MAJOR downside. That's not what I was saying. I relayed my experience where I was able to use my cap allocators leverage on an account in my name. That is all. Go back and read my posts. Or don't I really don't care.
I'd guess you're quite right that a CTA approach could work fairly well, provided three things. 1. The investor's money say $900K is up to alomst 100% notional. This part is the collateral money for the CTA's trading. 2. The CTA uses up to almost 100% money say $100K for margins. This part is the First-Loss money. 3. There is a FCM who can make this arrangement say total AUM $1,000K workable in writing. Trading profits will be split according to a pre-defined ratio say 50%/50%, that can be different for individual CTAs, based on negotiation. Just 2 cents!
I go back for generations in fl.. my great grandfather sold a patient to the gov and bought most of all the land in the city I was born and grew up in Demucking and fill can cost as much as the house does... boom town USA. South florida is white collar crime capital along with orange countyCA and Nevada .. My thoughts are... can I give you a hundo leverage my self to the tilt bury a bunch of my risk by gaming your risk controls and place crazy asymmetric payoff bets?.. probably not the risk control probably eats you alive
My apologies. I thought you were referring to "their" deal as no downside. Yes, your deal was a no brainer. Now, about the swampland. Yes, if buy swampland as swampland, you could do well. The old scam years ago was selling actual swampland to people from Ohio that never went down to actually look at where their property was. They thought they were buying ocean front condos in el poca vista and it turns out their property was really in el swampo gotcha. Little different deal then your gramps.
Its a prop bucket shop technique to jack you on commissions ... run you outta business and make it all your fault with no risk on them
Actually it was the same. He totally got scammed and never saw any return and we used to laugh at him for that one. He was long since passed when we were contacted about it. It was worthless up until that day. I went back and looked at the threads, are we certain that this is "their" deal? If so then I agree with everything that you and others have said. If not and it's something closer to what I did, then it could be a good deal for someone.