Prime Brokers

I have developed several algo systems mainly for the Forex Market. The current development depends on hedging techniques. The CFTC prohibits 'retail traders' from hedging so I am looking at become an Eligible Contract Participant (CTA?) which allows hedging.

I know very little about Prime Brokers and I am wondering if anyone can give me some insight on how this works such as eligibility, processes etc.

(Disclaimer for the haters)
1/ yes I am stupid, ignorant and a moron.
2/ yes I know that hedging is a waste of time
3/ yes I know that any system I have created is horrible.

 

so can you use forex fuutres for hedging ? I think most traders can trade futures in CME

 

An interesting idea, thanks for bringing that to my attention.

 

I'm fairly certain that becoming a CTA doesn't by definition categorize you as an ECP.

For an individual to be considered an ECP, there's a net worth qualification of 10MM USD. For an 'entity' to become one, in the event that you sought for your CTA business to qualify, I think the net worth (AUM) qualification is 50MM.

The fx futures route is a solid one if your strats will translate and you don't have that kind of cash laying around.

Something else you may want to consider if you want spot fx is 'synthetically hedging'. Different ways of going about that...but most simply...just use two accounts.

 

Thanks for the reply, good ideas.