Can you say why you are thinking of going prop? You say you swing trade, are you looking to move to daytrading?
I know two guys that trade the Euro on the floor of them MERC (from a Globex terminal) that only keep $20k in their accounts. They take $1-2k out of the market daily with very few down days. These 2 guys are the exception not the rule, but it can be done. I usually recommend (if this is what you want to do as a career) to have $50k plus 12-18 months worth of living expenses.
I dont thinks its insane(cant say that about the rest of his posts though). Lets say you plop down 25 at a prop shop. How much money do you have to make to survive? I guarantee its at least 25...min. Double your money to maintain that intial cap. Leverage aside you still need to make multiples of risk capital to earn a living. If you cant do this as a retail trader all leverage is gonna do is make the pain happen faster. Thats my thought on it anyway.
Thanks for responding. Yes I am retailer in two instruments: position trading stocks and commodities future indexes. My personal recommendations on capital as related to full time trading is to ease into it primarily according to your performance level. The array of possibilities is there to consider. I monitor a group of self selecting people and they are in several boats similar to yours. One non employed person is past her second doubling (2006 only time frame) and she started with about 40K 01JAN06. She has a smooth equity curve in the sense that it is not ragged. Another under 30 is multi mil and still works 2 days a week, largely because of his commitment to his trade (therapy) where he feels the orientation is valuable(I do too). He is making more than the first example. The minority of this group have not doubled, yet only about 1/3 have cut loose from employment. A good portion of the group have formed work teams for advancing the model we are using and it has become a transference model. Personally were I you I would pick a starting point, double, pull the initial capital, double and then take a look at making the transition at that point. you will just be using porfits at that time an you will "know" how fast your doublings are compressing. You will know much more about the aspect of trading larger blocks, etc, and what the new areas are that demand iterative refinement.
Most people who swing trade at the potential of the market do go to full time trading. They move to a refinement of using EOD data (or stale 30 min data after hours) to using real time. Commonly the hot lists, of swing traders who focus on making money, run at rankings of around 5% a day to be on the hot list. NEU as an example did over 7% yesterday. It has run up 300% in the last 52 weeks. It is position tradable frequently and youare way over 300 a year as you swing trade it periodically. Getting in and out of such high quality stocks most effectively and efficiently is done by monitoring full time using typically a 30 minute chart. after a while a person really gets the hang of swing trading quality small universes and he just trades parts of the long stock cycles. Those parts are the high money velocity parts. It involves a comparsison on held stock money velocity and hot stock money velocity. You switch as the owned stock flags lower than the accelerating hot stock at the top of your list. Cobweb commented to me about his ignorance on all of this stuff. It is certainly okay to not know about something but it is also a good idea to understand how other segments of the trading public goes about their business. The Spydertrader journal showed effectively how a person can get a universe of excellent stocks and trade them one after antoher as they do their "natural" short trem moves within their upward moving IT channels. It is not uncommon for the IT channels in a highly selective universe to be rising at the rate of 300% a year. A swing trader using that stock makes much more per year because he trades it rather than just buys and hold for the lesser amount of 300% a year. As Thundedog pointed out the Tucson IBD MeetUp group is running along at 10 to 12 doublings a year. Our VI team makes sure the stuff we hand out does not contain any stuff that could allow a VI to make mistakes. We vet everything for VI type mistakes. Cobweb is a VI type person he tells us, so we listen to him to be sure he can't do a VI thing as a consequence of getting his hands on what we do.
Hows your capital doubling this year spydertrader? If its not happening maybe you should traverse into Grob109's imaginary dinner table where everybody who's doing therapy to foot surgery and stock trading part time 2 hours a week while doubling their money sipping rum. Like a dream come true. Stocks Scientology! Harmless but retarded. ---------------- Many tradersdouble their money quite easily with different UNIQUE EDGES, <b> There is no edge in your method. Its just basic trading. </b> <h3>Please Invite Spydertrader to your dinner table that seats so many doublers. </h3> Why is he not invited??? Spydertrader, Why were you not invited? Did you forget to donate?