Although I doubt that 70% are profitable in this tough market, it's refreshing to see you admit that 50% of newbies fail. Other firms usually mislead people by saying the failure rate is much lower. While I may personally disagree with your business model, it appears that you are honest and run your shop accordingly. Good luck to you.
what about the success rate at firms that have a "trading model" and take a cut of the trading profits and losses ?
The "robot" firms had their worst year ever in 2001....check the numbers for Schonfeld (I heard they lost $400 mil)...and they're one of the best out there. Modeling doesn't generally work...it did during the bubble years...but we're back to normal markets now (with the benefit of increased intraday volatility). Don
You know, I keep hearing about this "tough market"...and I am being serious when I say our people are doing exceptionally well overall....we love the volatility, and the openings have been paying off really well. We tend to make more money on the downside, for the most part. The 70% is the average over the last few years, and I'll be able to post this years success rate when the year is over. Remember that 90+% of all business ventures fail...and we beat the heck out of that...with a very limited downside, and an unlimited upside. ...back to you all... Don
Hi Don, How much capital is allocated to a trader (assuming they put up 25,000) when they start? As they become consistently profitable, are they given more capital to trade, and how is this amount determined? Chuck
Don is right. If you can look past the down direction that nost traders have a bias against, this is a great trading market. Its summer too. What more can you ask for? Straight up? 1998. This is straight down. Us short siders are having a 1997-98 year.
We monitor "risk" not "margin"....many use $2 or $3 million on the opening strategy alone, with $25K in their accounts. This is "use" not "abuse" of capital...(we don't let people risk that kind of money, we monitor closely). The point is ...there is no specific amount (10:1 or whatever)...it is based on what you're doing. It is not unusual to have 50:1 during the day... We do our best to not restrict our traders based on some arbitrary amount. Don
Don, I'm am confused about the statement you made: "Traders who fall for the "prop" (no cash" thing end up actually losing much more money than we ask them to simply put up (hopefully never lose). Could you rephrase that? The point you are making completely eludes me. Thanks
http://elitetrader.com/vb/showthread.php?s=&threadid=7100 I've been chasing Don around with this thread, but I guess he hasn't seen it yet. If you get a few minutes, I'd really appreciate it. Thanks!