I have been a party to several trading employment contracts throughout my long career, and I wanted to share some thoughts. I am not a lawyer, and would encourage any trader to seek the counsel of a specialized and credentialed employment lawyer ( professionals and IP ) before entering a trading employment contract. Do not hire an attorney who has not represented a client before in your exact circumstance. I spent $10K on a trading contracts attorney before bringing an energy trading group over to a hedge fund in Chicago in 2006 - that's just one instance of several in my career. Disclaimer: when I speak of trading employment, I am referring to private equity groups or firms that do NOT take employee or trader funds. They are strictly putting the firm's capital at risk and you are considered to be an employee of the firm. They will likely pay you on a W-2 and will offer benefits like health insurance and a 401K. Some thoughts: 1. Know the employment contract laws for the State in which the firm that is hiring you is incorporated. New York, Connecticut, New Jersey, Massachusetts, California, Illinois - your typical trading firm headquarters locations have State laws that largely invalidate many of the overly restrictive and onerous terms demanded by trading firms. In other words - the contract is pure intimidation meant for the timid and uninformed. 2. Emails will not and do not modify contracts. 3. Understand that the contract is almost always demanded by the employer, and is biased in the employer's favor. The legal concept of "consideration" is your best friend here as an employee. If a firm demands that you cannot seek employment in your profession for a specified period of time, or demands a percentage of future earnings - generally speaking, "consideration" means that in turn the firm has to compensate you for that in like. In other words, a severance package. 4. If you are being hired straight out of school with no trading background to speak of, and they are putting you through a training program and paying you a salary for at least your first year ( think IB or HF recruiting Ivy League ), then the terms of the contract will likely be much more enforceable if they are taking a well-educated civilian and turning that person into a profitable trader at considerable expense and time and investment to the firm. 5. Unless you are a salesman or marketer or executive or such taking established clients away from a firm, States are generally speaking not receptive about enforcing a verbose and onerous and one-sided employment contract. 6. Understand that you can modify a "standard" firm "boiler plate" contract that they claim all traders sign "as is". The key here is to understand and appreciate why they are hiring you to begin with - and then give yourself an innocuous "out" in the contract. Almost always, a proprietary trading firm is hiring you because you bring to the table what they would consider to be a proven trading strategy. This is "Prior Art" that they want to claim complete legal ownership of but that you need retain by handwriting a very brief statement to that effect in contract. You should then initial and date it. This is NOT subterfuge - you are stating a fact and you are simply asking them to acknowledge the same in the contract. Again, if you keep their contract intact, your emails to the contrary or explaining your prior credentials will likely not be enforceable. The key here is to keep your handwritten and initialed statement very brief. For example: " Both employer and employee recognize that the trader has previously developed and brings to his employment term prior art - including strategies, methodologies, and unique software and machine coding." If the majority of your interview and email conversation with the employer centers around what you bring to the table in terms of your previous performance and trading strategy - then you are simply asking them to contractually acknowledge what is an established fact. Doing so will give you great leverage and immunity. You indeed can modify a contract in handwriting if you keep it brief and factual, initial and date it, and the employer either initials and dates the same statement in kind or alternatively they enter your "slightly modified" contract into your employment file for the record. Keep hard copies of your contract.
Bingo! Also, IMO too many people devalue themselves to get an opening. If you are good, your strategies are worth more than their capital, platforms, and other aids - if you develop them independently, don't let a firm take exclusive ownership of what you develop or modify while at the firm, and this stipulation needs to be explicit - My two cents.