Aside from the reg./marketing issues and net worth req. plus the solicitation of outside investors is there really a true difference between a hedge fund (broadly defined) and a prop firm. It seems like they basically do similar trading patterns though most prop firms do not engage in currency swaps, derivatives, et al but I see no regulatory requirement barring them from doing so. Moreover, though most prop firms engage in intraday trading as their primary vehicle they could take longer positions. The only principle difference might be that prop firms garner a lot of revenue from commisions and rebates while hedge funds are purely trading vehicles. If anyone from a hedge fund or a prop firm could discuss the major differences please do so. Ciao.