I doubt they totally shut down the llc's. I could be wrong but doubt it. It gives some the opportunity to trade where other wise they couldn't. Tightening the rules is a good thing. If someone wants to trade and you may know it's not for them explain to them every detail(good/bad). Just make sure you protect yourself from the sour grapes at the end and make them sign something. This game has changed and the money has fell off a ton. Geez a good month of 100k is now a good year. If i fell below(100 k) a year i will move on and do something else. I was lucky to have been around when times were great and also to save it and spend it wisely. Bring back 1999 please(wishful thinkg). I wouldn't worry too much about the llc shut down if they do there is always another way!
nobodys mentioned the true reason the sec is getting invloved. i'm 100% positive it's because the sec has recieved 1000's of complaints over the years from prop traders but can do nothing as the complainer doesn't have a "real" account. he's nothing but a # trading another persons account those has no rights so the sec really has a hard time getting invloved
again.it comes down to persomal responsibility and due diligence. if someone loses everything and then blames a prop firm,perhapd he should blame himself. is a gun guilty of murder or a person? that said,if a prop firm does engage in any kind of fraud or misrepresentation then they should be dealt with on a case by case basis just as any other industry.the sec NEEDS NOT TO OVER REGULATE.
legal rights with who? can they call the sec and say xyz prop firm stole my money but i have no real account as i trade his money? will the sec investigate the prop firm? even if they can the 5k down piker has no spic ins so when xyz prop flee's he loses his money. bottom line is one needs a min of 200k to even have a remote chance to make a living in this game. i'd even go on to say unless one has 500k i'd not even try to day trade. think about it 30% a year on 500k is 150k a year. how many people average 30% a year on there money for 10 straight years? far and few between. sure you can get leverage out there but again "you're putting your livilihood in someboy elses hands"
It makes sense. Not everyone takes losses like a man The llc was good for two things. One line reporting and leverage. After that last fiasco with jasper retail is the only way for me. Fact is this day trading business is pretty much on a respirator and they will take anyone. Some llc's run a clean shop but like anything else when they are not doing well they will fold and screw the traders(because they can).
Yes, you can say that. With most prop firms you have the right to take them to arbitration. As a Class B member, you can take legal action against the Class A members as you can with any LLC. I do however agree with the 2nd part. It does require a lot of capital to make it in this business.
You need to be worth at least 250k(liquid) to have a better shot to do this for a living. When you start you need to build your bank slowly. This is not a knock on traders who don't have this equity but it makes a tough game alot tougher. hypothetically if you have 50 grand savings and reach tough times(1 year) your cost of living will eat through your savings. Most traders from llc's not all couldn't survive 6 months let alone a year. Most get involved in this game when they are established financially but it can still be done with a small amount thanks to the llc's. If you are confident and all you need is a few k up then that is awesome. But check back with these people in 5 years and see how it's going. The previous poster saying 500k up and to make 30% his comments are correct and he will get shaken out after a trader with 50k up. But why the sec is getting so involved is because of the complaints from the sourgrape group so they are to thank for this situation.
Again, I am not disagreeing with this. I tell most traders who have under 100k that their odds of success are less then 1%. And I really don't see the SEC getting involved in anything. They went after one or two firms that were being run like the mafia. That is not a knock on the prop firm industry. Those firms should not have been allowed to do business anyway. I still don't understand what this thread is about.