Trade group / prop firm taking other side

Discussion in 'Prop Firms' started by Topper, Oct 19, 2010.

  1. Topper


    I recently signed up with a trader group out of state that trades arcade through a prop shop. I've been with the group for almost two weeks now and am down slightly but hanging in there. Prior to me joining I traded retail for several years and sim for the past year and was profitable in both.

    My concern is that knowing that other people (from two separate groups) out of state are able to watch my screen, I kinda am wondering if someone in the chain is taking trades against my trades. The reason why I'm even thinking this is because it seems that the second I put a trade on, the price seems to slam against me
    and I'm not use to this in my retail or sim, as I generally position well.

    Is it possible that someone who's watching me would do this, and if so, what would the benefit be? Thanks
  2. if you're using resting limit orders this will normally be the case. Where if you put a buy lmt order at the bid. If you get filled you'll often find the bid is now the ask. This is high freq trading.
  3. try this - get a totally separate data feed with time and sales and watch that against what you're currently seeing.
  4. Topper


    It never really occurred like this in my retail account which is why it seems so odd to me now... the trade may go against my open slightly, but never 'slammed' against my order as it has with this new venture.
  5. Topper


    Thanks for the advice. I'll look into it tomorrow. What's interesting though is since posting this yesterday here on et, I haven't had any trouble today whereas all of my trades were fairly routine.

    My new question though is that when cross interviewing with other prop services, I learned along the way that it is illegal for a firm to use their capital against their traders. So, if my suspicion does prove to be true, mind you not saying it is, but if so, what governing agency would I place a complaint with? thx
  6. well lodging a complaint against your firm - you may want to pull your $ out first! :) Maybe the exchange they are a member of..

    I suspect - increasingly - daytrader trades are getting crossed internally by either the firm or whatever ecn its going to. Interactive Brokers been doing this forever with their 'SMART' routing.

    You can consider it 'trading against you', but in a liquid stock does it matter because the market could always move in your favor and against those taking the other side of your trade.

    Firms hedging against their own traders, to control risk, I could definately see and legal or not there are a number of ways they could hedge against your pos and not get caught for it.
  7. Topper


    Right. I think maybe I'm just getting a little too paranoid because in reality, my manager is a pretty cool person who actually hooked me up to get me started in prop.

    I think what it is that I dont get is before, when I was just trading retail not even needing a level 2 screen and all of that fancy bs, I was rockin'. Sure I'd take a bad trade here and a bad trade there, but I would buy stocks like ENDP or ASYS and hold em for a few days and make a nice chunk and move on to the next one. I was making money there. Now that I switched over to daytrading, thinking the leverage would really catapult my abilities, I find myself fighting businesses within businesses instead of just good ol fashioned clean trading, and I'm not happy with it. WTF? This is stupid!

    I'm pretty sure I can learn how to play the game, but is it worth the time?