Props and Non-Compete Agreements

Discussion in 'Prop Firms' started by flowtrader88, Mar 2, 2009.

  1. Hello All,

    First post here and thought i'd be the devils advocate. I'm sure many on this board have similar questions.

    I spoke to a few props which required capital contribution, offer no real training, and require you to sign a non-compete agreement.

    Now this is absurd to me - why should we and why would a prop firm require us to sign a non-compete which restricts us from working for another prop for x years if we paid a deposit and they don't provide any training? If someone has to close their account due to poor performance, they have to refrain from prop trading for x years altogether? That doesn't really sound fair...

    Also, how in the world would a prop firm know if we started prop trading elsewhere? Do they stalk their ex-traders?

    Maybe someone can shed some light? I know many prop firm owners read this forum (i.e. Don Bright), so maybe you guys can shed some light.
  2. If your prop firm offers no hardcore training and "know-how" coaching then you should not be signing a non-compete agreement.

    If, on the other hand the prop firm helps you navigate and adopt their trading secrets then you should be signing a non-compete agreement since you can just leave and give away their trading ideas to another firm.

    I signed a non-compete agreement thus I get some real insights into my coach's personal trading system. So I definitely don't mind. This is probably the only reason I'm making money recently. Up a few hundred already this morning! Time for a trading break.