Prop trading shop

Discussion in 'Professional Trading' started by smalltrader35, Dec 8, 2005.

  1. Can any of the pro's here on elite give me a list of requirements for opening up a Prop Equity Broker House. What Licenses does one need etc. Can anybody put me in touch with the proper people who can guide me through the general procedures in starting such a venture. Any insight would be helpful.

    Thank you
  2. r-in


    If you are looking to open an office under the umbrella of another firm why not just call the Brights, or Echo. They seem to be the 2 biggest represented here.
  3. 1. Buy an exchange membership. - Or (as a second choice, become a member of the NASD).
    2. Talk to Clearing Firms about your financial relationship. Goldman's a bit tougher to qualify for, perhaps Penson.
    3. Deposit appropriate capital, usually $1-$5mil should do it.
    4. Hire a really good Compliance Officer...this is crucial.
    5. Acquire Series 7, 24, 63 licensing, at minimum.
    6. Register with each State individually.

    Check with Compliance for anything further...this varies from exchange to exchange.

    As an alternative, you could align youself with a B/D who has done all of the above and try to negotiate a deal to bring on a group of traders.

    As in any business venture, good Lawyer, good Accountant.

    Good Luck,