To Prop Or Not To Prop?

Discussion in 'Prop Firms' started by bigpapi, Jan 9, 2010.

  1. bigpapi


    Should a person wait to save the 25k to 30k required to daytrade or go through a prop firm.

    The only advantage I see with trading fully with your own capital is lower commissions.

    With 25k, and 4x leverage, there is only intraday 100k buying power, whereas a prop firm will give you 100k buying power with less of your own money at risk (example 20x leverage = only 5k needed).

    So I guess the question is, why risk so much of your own money if you have developed good trading systems, when you can have the same buying power at a prop firm with less risk of your own capital????

    Is lower commissions and platform fees the only advantage to risking your own money????
  2. gkishot


    Higher leverage means more risk not less.
  3. bigpapi


    Depends how you look at it. If used responsibly leverage can be a very good tool, it's an interest free loan for daytraders. If you are a cowboy then it doesn't matter how much or little leverage you have you will blow up. You can also blow up with zero leverage, I think it depends on who is steering the wheel.
  4. I don't think this is correct. At a prop shop like echo for example you can negotiate low commish over time once you establish a relationship. Plus the leverage is a must if taking the biz seriously.

    Soooo, if you can trade then yes prop is the way to go, not retail. IMO.
  5. bigpapi


    So you don't nothing good about having a retail account????
  6. bstay


    have u considered spot forex? don't need $25K min to meet PDT rules and no platform software fees. every retail forex broker will provide 30-days demo account to test out their offering. if u have a proven trading methodology, shouldn't matter what u trade.
  7. bigpapi


    list or pm me some reliable forex brokers that you've used
  8. if you don't have a proven successful methodology and discipline in your execution process, trading by with or without leverage will result in a loss.
  9. bstay


    i've been using GFT Forex and it's DealBook360 platform (stable, no downtime). but others here preferred no-dealing desk brokers or ECNs and those offering MetaTrader4 (or MT4) charting platforms so that they can take advantage of popular custom indicators written on MT4.

    forex brokers give u 100:1 leverage, up to 200:1 or 400:1 on micro accounts if non-USA brokers.