Hi Everyone, We just joined as a new sponsor of the forum. Traders With Edge is actively looking for good traders to fund. Unlike many other prop firms we are actually looking for profitable traders, not looking for gamblers who will fail challenges. Yes the challenge model is part of what we do to filter out the people who want to flip a coin and get rich quick. The whole reason I started the firm was to build a strong portfolio of traders who want to work remotely because our other company is a funds management company. Aside from the challenge model we also run trading competitions each month. These are free to enter and we give away lots of good prizes. As well as looking for good traders to fund we are always open to mutually beneficial business collaborations that grow the pie for everyone. So reach out if you think there is something we can do together. I'll leave it there for now, as I didn't want tihis to be a long pitch post. JUst wanted to say "hello" and looking forward to getting to know you all more over time. Regards, Samuel
Out of curiosity, why do you think a trader with an edge needs money? Why not just start trading the micro ES or micro NQ and work your way up? If you truly are profitable, couldn't you build your own account organically? I just don't know how someone who can trade a 50k account (that he is given) and swing 5-10 contracts wouldn't already have enough money to trade at least 5k of their own money, even if it meant only trading 5-10 micro contracts initially.
Will independent traders (non-professional) have to pay professional data rates if they get involved with this kind of business?
I can't imagine someone with a good track record, meaning they already have some decent amount of funds going with a firm to start doing some challenges as if being at step 0. Maybe such oddities do exist but not many.
Good question. You either pay with time or you pay with money. An amazing trader living in the US who is making 10% a month, who is a mechanic full-time and has a $5K account is going to net $500 a month. One can't live on that and if they want to compound their account, how long will it take them to have enough to quit their day job. A long time. What was the cost of the time that you can never get back, infinite. On top of this we all know that it's easier to risk a large % on a small account than a large % on a big account. If one has a $1M in funding and they actually understand risk management they are now much closer to quitting their day job to trade full-time. What is the compounding of the time saved worth on the larger account? A lot. Of course not everyone is making 10% this is an extreme example I am giving and many traders are not in first world Countries, so the example is amplified.
Currently there are not rates to pay because we use a third party broker who has great retail rates. Over the next year we plan on brining this in house to reduce the spreads and commissions even more. There still will not be any data rates for the trader payable though.
The question a trader should be asking you is, "what is your risk profile and what risk are you taking on by offering such a deal"? If you are taking on risk than there is more benefit to the trader, but I doubt you take on much risk at all. I didn't look at your website because I don't think I need to. Ultimately, you probably fund people after they have passed some tests and then restrict their drawdown to a point where you have almost no risk. In your example, the person that trades well with 10K needs more money for 1) creating a better risk profile, 2) increasing profits, 3) being able to live through sustained drawdowns. Your deal will not help with #1 and #3, as you can't create an optimal risk profile if drawdowns are essentially not allowed and without allowing reasonable drawdowns, the trader will always stop out and lose the ability to play your game (forfeiting all of their commissions to you). Your deal could be valuable if you watch traders, find the strongest ones over months, and then allow them to have reasonable drawdowns. This gives more profit potential to them, but increases your risk profile substantially. As it sits, the 10K account could simply open an intraday futures account, trade NQ instead of MNQ and close the account if there is a loss over 2K. This is probably similar to what you do. You give 100K (which isn't really 100K, it's like 2K) and then if they fall to 98K you close them out. With intraday futures, anyone can replicate what you are doing for cheaper. The reason you won't invest in traders as I say above is <2% of traders have good risk profiles after a few months, significanly less have good risk profiles over a year. They simply don't exist and if they did, they don't need you. Therfore, you wouldn't have a business. Also, you are not capitalized to take on all of that risk. It's a brilliant business idea what you are doing, but someone who looks into should realize I can do the same with intraday futures and my own close out rules.
No futures? I was intrigued when I first started reading, but at a glance it doesn't seem that different from the rest of the shops in the same genre. One thing I know for a fact about these pay-to-trade-in-demo firms is that the only funding you'll ever receive is the initial $5K margin. Even if you made $100K of profits - they won't stake you. If you withdraw those $100K - your account is effectively gone. Is it different with your firm?
"...Example 2 (Violation): The day’s starting balance was $100,000. You open a position and it goes into $6,000 profit but you did NOT close the trade before the end of the day. Instead you moved your stop-loss to breakeven. At the end of this day your account equity is $106,000 which is carried over to the second day. On the second day the trade goes back to breakeven and is closed by your stop-loss. Even though the individual trade did not lose from the balance, you have lost more than the allowable amount (2.5% on a Turtle account) on a single day and this will be a hard violation and the account will be closed." This is pure deceptive fiduciary duty. No thanks! Next!