Great thread traders, I have a few questions: 1. What are all the costs of running a domestic equity prop firm? (list of all costs broken down separately would be helpful) 2. Can a prop firm survive by doing a profit share only model and zero commissions? 3. Can a guy holding series 7/55 start a prop firm? 4. How much personal capital contribution is required to start a equity only prop firm? Thanks a lot
look, i love your fear mongering but i have been spread trading for a while, on indexes, crude, etc. and i understand the dynamics. as i said, i can't speak to "pair trading" a la bright. i was mentioning spread trading. it is not rocket science, any more than trading itself is rocket science. develop an edge, control risk, and stick to your rules and stops - ALWAYS. that's how i trade. and i didn't say trading a spread was easier than trading direction. i said it mostly eliminates market risk, which is true. in trading a spread, you HAVE ot get the divergence right to make $$$, just like when trading direction, you have to get the direction right. i never said it was EASY. it's trading. it took me almost a year of losing money before i became successful at trading, and i learned , as the columbian say "with blood". i respect the market. but i don't care how many other quants are spread trading. i have my methodology and it works. even without 100 phd's "OK, I need to say something here. I hear statements like this all the time and I have to call BS when I hear it. Guys, it does not matter if you are trading direction, volatility, or a spread price, there is nothing easy about trading. Trading a spread is no easier then trading direction. In fact, I will go on record and say it's harder. And let me tell you why. Usually when a spread goes against you, you have no reason why it's going against, you just know that it should trade within a certain band. You don't understand it except you believe it should. At least if you are long or short the ES at certain levels, you have an idea why you are wrong if you get stopped out. Also, when spreads go against you, they can explode against you. They can get very violent. In fact, the irony is they are actually much more volatile then the actual indices themselves. I love how guys paint pair trading like it's so easy. It's incredibly difficult because you are driving the car but you don't know what's underneath the hood and if the car breaks down, you don't know why. You are basically driving blind."
Scalper>>>>>>only a moron will give up or divulge a recipe or formula to only bring in more competition into their market. It is not very easy and if you can trade for a living consistently...stick to that. Dealing with traders sucks///not worth the pennies and nickles you make.
My class has always been $1,000 for 3 days, and is open to the public. We cover pairs and a lot more, of course. Advanced "immersion" basically one-on-one is done by Rob Friesen in Canada, and is part of a much bigger overall package. Those of you who would like to learn more about pairs (for free just to calm the cynics out there), send me an email to: donbright@brightrading.net with "Pairs Please" in the subject line, and I will send you a nice presentation. We are starting to do more webinars, and I can add you guys to the list of participants if you like as well. All the best, Don
Forgot your vig, Mav...won't happen again, LOL. BTW, I have received several requests for Pairs Introduction and have sent them out, so the email is working. donbright@brighttrading.net ( 2 T's in brighttrading) or don@stocktrading.com will work as well. All the best to everyone, Don
Mav, I am not against going prop. I think it is fair if you and Don can list the disadvantages or the risks in joining prop.
You're probably going to hate this response, but here goes. One of the biggest risks in "going prop" is who you align yourself with (financially), whether or not you can "handle" the amount of capital usage available (not everyone can, obviously), and the biggest risk is controlling your emotions when you're losing and then "doubling up" or "quadrupling up" to get even...this can be disasterous. My feeling is "if you're planning on trading anyway, why not remove the barriers that exist in retail trading, learn the lower risk, higher reward, but capital intensive, strategies that are available to prop traders". Even the "ROI" (return on investment) types who can make 40% or so on $25K, why not do it with $500K (modified to suit the capital of course). That and you may have to pay professional exchange fees of a couple hundred bucks, and take the proper tests for licensing. Studying is always a drag, LOL. (Mav?). Don