rtharp, Did you find out how much it is to trade remote. Also additionally to the .0125 for nasdaq trades, is there any ECN pass through fee's?? I'm going to give those guys a call on monday, but you if you could give me some insight till then, it would be much obliged. lex//
Yes $600 is a lot, but I traded Electonically in the Big Apple when it wasn't even a fad, 1990. We traded with Bob Kanter (ETG) and he charged us $1500. On thing to consider is the money is always pooled funds (even if they pay-oy 100%, or like Bright held %10 for insurance 'til fiscal year end). If the LLC has short funds one or two rogue traders can blow them and your money out for good. You have no FDIC !!!! Check it out !!! Bright has a lot of money and they keep the funds in escrow at Fidelity(a nice touch) so even if some maniac trader gets out of line - your funds are not at risk. I think you have these danders with any other firm (except Bright and ETG). The bottom like I hate losing money but I rather "do it" to myself than some you trust-fund kid blow my money away along with a trading company.
andrasnm, You know your shit about bright. Do you trade with those guys? I was considering them if I went with a office setting. I'd have to go check them out and see what kinda opperation they run. lex//
Lex, I have no affiliation with them, except last year I turned in my (dated) series 7 reg. documents to start to trade there, after which I found out - they moved from Philly Exchange member to Chicago Stock Exch, meaning that I had to take the series 7 again. I opted not to do it. I am no stranger to trading and paying office fees (see Kenter exprience) - being in an office can be an immense advantage, I had the privilege to watch Bob Kanter trade in a same office with us and in some way it was worth it (the monthly $1500 for about a year) in a hindsight it's a lot but you'll pay some money to go to Harvard too. I know that Bright is doing it the right way. Having pooled money is dangerous and every experieced trader knows a few of these wire firms go under. I am resigned to the fact that I likely won't trade in an office anymore for personal reasons, but if I had to Bright would be my choice despite you will need an active seris 7 or retake it which is a bitch (I have done that once and no desire for seconds) Good luck
Trading in an LLC does have some risk. However most of the leveraged firms(8 nationally) cater to daytraders, which means little or no overnight positions. If you do have a question about a firms capitalization , call the firms clearing broker-for Lieber & Weissman Sec., L.L.C. and Bright, that would be First Options of Chicago. Not to plug our firm , but I believe we have one of the best managed LLC's in the country. Overnight exposure(postions) are the real risk in any firm organized as a LLC and we keep overnights to a minimum or hedged with options. Bright trading is now an LLC and they have the same risk as any other LLC trading firm . The risk management of a firm is the real portfolio insurance. I believe daytraders and short term professional traders benefit from the organization of an LLC. As long as firm risk management is in place , I belive the benefits offset any risks. See our risk management guidelines and hedged position requirements: http://www.stocktrade.net/services/portf_hedging/hedg_requir.htm A trader at an LLC can put on conversions , married puts , matched pairs (Long SLB,Short DO) and leverage daytrade positions without having to worry about margin calls. A Series 7 license is now required for all LLC firm traders. Gene Weissman Lieber & Weissman Sec., L.L.C. Members PHLX/SIPC gweissman@stocktrade.net See us at http://www.stocktrade.net
Overnight positions are a real danger, also real time risk managment or the lack of !! The recent debacle of trading firms (and real loss of funds) occured not by overnight positions but market volatility and traders trading at home, without someone watching them. ETG, and Bright won't allow anyone trade at home, because they are harder to monitor. If NAS would drop 700 points (not that I am saying it would) the Day Trading positions in nas stock could hurt a firm who is too cheap to have decent real time monitoring and short on capital. If the only funds they have is the 25k from ten traders plus the ~million that clearing with Spears requires - you can see the problem, right? This is why they are asking for NAZ trader to put up 50K. Bright real strength is in speciaizing NYSE stocks, which I still think a more honest and safe trading environment. By the way I have asked around all of the big firms for financials and they are all very hush-hush about it and NOT forthcoming at all. Even at Bright unless you are a big know trader they won't care if you came there or not !!!!
I would agree with you that the overnights are the real risk for LLC's. With REDI+ risk managemant software you can monitor remote traders real-time and put share limits on each trader. I could set a trader with $25,000 capital to 200 or 500 shares max or by account value. Bright & ETG may not want to deal with remote traders , because of the extra risk management involved. We are set up for remote traders and welcome any professional remote traders. I know Bob Bright does not like the NASDAQ market for many reasons including market fragmentation and volatility. I would disagree that you should only be allowed to trade one market. I can buy or sell 5,000 of INTC, DELL or MSFT on the NASDAQ market(large Cap Nasdaq). You can trade NASDAQ with a $25,000 account. I would not suggest any trader leverage in high volatility Nasdaq stocks like JNPR. The leverage at a LLC is to be used not abused. We have both successful NASDAQ and NYSE traders at our firm. Since both markets trade differently, it is best to trade either Nadsdaq or NYSE , not both. Gene Weissman Lieber & Weissman Sec., L.L.C. Members PHLX/SIPC gweissman@stocktrade.net See us at http://www.stocktrade.net
I finally got a hold of Echo trading and spoke with a guy named Jeff to find out the details about there costs and services aviliable. Here's the break down, the guy Jeff I talked to was a cool guy and told me that the first alert software data feeds would be 300$ a month, they charge .01 per share for NYSE, and for NASDAQ it's .0125 per share + .0025 of a cent for island pass though fee's, which totals to .015 per share. Now I'm comparing that to Bright trading which is also .01 for NYSE and .0125 for NASDAQ using Redi Ecn. Bright trading is .0025 of a cent cheaper, for NASAQ. While talking to Jeff he told me if I went with Bright and didn't like trading with them after a couple of months that I would have a problem getting my money back. So when I was at bright I asked them how would I go about getting my money back if I didn't want to trade there. They told me that I would have to wait exactly one year from the date that I started to trade with them to get my money back. That discouraged me a little and I have to think about that one for a while. But Jeff with Echo on the other hand told me that I wouldn't have that problem with them and that there software was a combination of redi plus and first alert. So Echo sounds like a good deal, just wanted to add a note to fellow traders about these guys. lex//
Jeff and me used to be on the floor together at the CBOT during the same time. I was in the 30 year pit while he was in Soybeans. We have a few friends in common which was interesting. We are using our own software. The designer of the ECN Brass Utility designed our trading software. I had a few problems when using WindowsME as my OS system. I quickly changed to WIndows2000 and no problems at all. The software reminds me heavily of real tick. Extremely fast. I may open an office soon for Echo in San Diego if anyone is interested in trading with them here. I wasn't aware that Bright kept your money for a year, talk about a negative. What bothreed me about Bright was that I MUST trade in their office. I've seen how a crowd mentality can get to a trader. It's something to avoid. They said maybe after 4-6 months I could trade remote. Robert Tharp
rtharp, I truely don't want to sound biast but the 'herd metality' can also be 'smart crowd', could be be better that uninformed solitude. You should know trading on the floor. Bright has some guys in the Southern Cal area who are million dollar makers (not producers of comission but making that much) would not mind being in the same room with them. Kanter gave us 'whif' a few big block trades occasionaly in New York so we could tail-ride a few of those. It can mean $1000/day from breaking even. But the jest of it - if something goes wrong technically when you trade at home - you are own your own, if Bright has problems they have back-ups in Las Vegas or New York City. I don't know Echo from Adam. They can be the best new trading firm from all I know. However Locking up your money and giving a shot for trading for a year is not all that bad. It just separates men from boys who have a few bad months and just want to bail. I would do exactly as Bright if I owned one of these firms. Kanter(ETG) locked us up for about a 18 months but you of course knew that before you signed up.