The main reason why doing business with these get-funded programs is a bad idea...

Discussion in 'Prop Firms' started by Laissez Faire, Jul 20, 2021.

  1. Upon passing the evaluation OneUp will tell you that your account is under review by the 'risk management team' and that the results will be submitted to their funding partners (in plural). I'm pretty sure this is all smoke and mirrors in an attempt to sound professional as every funded (LOL) trader is paired up with MES Capital as far as I can tell.

    I scrolled through some boards including the one at OneUp and there's many guys who've been funded many, many times and are still trying and still paying.

    So it's clear to me where the money is coming from...

    As I'm still living out of a suitcase for the next few weeks I considered doing an evaluation with E2T as they have a discount, but I'm thinking maybe it ain't worth it anyway.
    #71     Jul 31, 2021
  2. danielc1


    I do not understand you. You are complaining about the rules, the way they operate according to your insights and still you are considering to 'try' it again?!?
    #72     Aug 1, 2021
  3. Yes. It's clear that my main point went over your head and that you do not understand.

    I never said that it's not possible to pass an evaluation (I passed myself). I never said these companies do not pay out money if you succeed.

    What I said is that they do not have any vested interest in actually funding you as a trader and letting you grow an account with them. Several of these companies have a structure where they actually lose when you win and there are clever rules in place which makes the game rigged against you.

    The reason I only considered it now is that I'm in a life situation for the next few weeks where I do not want to put my real capital at risk and figured it could be a way to stay in the game with the potential upside of taking some money out of such a firm. But in the end, I decided not to.

    As far as I can see, I'm done with these companies for good, but if I found another company which actually wants to fund a trader I would definitely be interested.
    #73     Aug 1, 2021
  4. danielc1


    I hope you find a company that will fund you, have rules you like, and will be suportive when you brake them...
    #74     Aug 1, 2021
  5. I believe this is the main point he is trying to get across

    90+% of these companies portray themselves as having a vested interest in “funding” you and they attempt to portray the deal as one that can provide funding for you to trade with the rest of your life

    but that is simply not the case. At best 90+% of these companies only provide “temporary” funding that ends when you have made profits equal to your starting trailing drawdown. So for example if your daily loss limit is $3300 and your max drawdown is $4500 when you have made $4500 in profits your funding from the company is taken away (I.E. you no longer have a drawdown) and now your only “funding” is the $4500 you made and if you want to continue to trade with them you must trade using your own money and you pay them 20% of the profits you are making with your money

    most brokerages only require $500/contract for daytrading SP500 and closing all contracts before end of session and never holding any contracts overnight so you could simply withdraw the $4500 in profits and trade with your own money in your own account and not pay them 20% anymore because if you leave your account open with them that is exactly what you would be doing as your only “funding” left in the account is your profits. They no longer provide any funding

    does that sound like they have a vested long term interest in providing you funding continuously—of course not

    #75     Aug 1, 2021
    Laissez Faire likes this.
  6. danielc1


    Sure, I agree that they run a very tight ship with every new trader that comes in and get funded. They have to. Most funded trader blows up in their first 30 day's.

    But if they have a trader that just know how to handle it, they go far and beyond to make it as sweet as it can be.
    More contracts? You got it. More markets? Sure. As long they see you have made a cushion for your risk appetite, the sky is the limit. Is it not normal for a company to want to reduce their risk of exposure to nearly zero as soon as they can?

    #76     Aug 1, 2021
    cafeole likes this.
  7. LOL.

    Why continue risking your OWN capital for an 80/20 split?

    Some people are just slow to get it.

    You're always risking your own capital with these firms. If you withdraw your profits you're back to square one or even worse - your account is gone.

    The company is fine with you taking risk as long as it's your own profits only that's at risk.

    Considering that there is no reason at all for why a trader should want to continue trading with a firm AFTER he earned the initial 8K they typically let you earn for a 100 % payout. Withdraw the profits and trade for yourself with a 100 % payout.
    #77     Aug 1, 2021
  8. danielc1


    Let me give you a real example here:

    When oil jumped due the attack a couple a years ago, I just shorted it with 25 contracts while my own capital at that firm was around 30000 dollars. My profits that is. If I want it to do that in my own account I had to have 280000 dollars in it, just to cover the initial margins.
    #78     Aug 1, 2021
  9. Is it not normal for a company to want to reduce their risk of exposure to nearly zero as soon as they can? In the funding business--no, that is not correct. Credit card companies dont reduce your credit line to zero if you use your credit line continuously and pay it off continuously. No--they keep the credit line open and in many cases actually increase your credit line over time.

    The problem is these trading companies portray themselves as continuous funding when in actuality--they provide 1-time very limited funding that is cut off at the 1st sign of success by the trader

    #79     Aug 1, 2021
    Laissez Faire likes this.
  10. yeah--they are either slow to get it---or are shills for one or more of the trade fundin g companies

    #80     Aug 1, 2021
    Laissez Faire likes this.