What must I know before joining Prop firm?

Discussion in 'Prop Firms' started by jimclark, Sep 6, 2007.

  1. I am looking to join a prop firm to trade mostly morning sessions and some random daily routines....since I have a full time job but do have a flexability of trading (work from home mostly)

    From reading posts there are many 'reputable' and legitimate firms but it seems there are some shady ones too...that hold your money for a while, messup your commissions, have poor support system, demand certain # of daily trades and require to trade a certain amount daily.

    Before selecting a prop firm what things should I know and ask about the prop firms...before I committ my money and myself?

    I appreciate real and honest onion.

    Thank you.
  2. ?
  3. Scroll down to Prop forum, and spend couple of days sifting through all the info.
    Everything you need to know you will likely find there.
  4. I did but don't find exact answers to my questions and concerns.
  5. From my website, FWIW.

    Experience - have been with the same Clearing Firm since 1978.
    Financial Strength -
    Use of Capital -
    Locations - and Remote trading
    Education -
    Affiliations -
    Technology -
    Cost Structure -
    Flexibility -
    Independence -

    Before choosing any Firm, and putting your own money OR valuable time at risk, be sure to ask for this basic information:
    1. Financial Statements (Don't ever go into business with anyone who won't share their balance sheets with you!).
    2. Clearing Firm affiliations. Be sure that the Trading firm is aligned with solid Clearing Firm(s).
    3. Exchange memberships. Be sure that your chosen Firm is a member of a Stock Exchange and has it's own Broker Dealer.

    This is only common sense, and applies to any business, whether you are trading or not. Know who you are associated with!


    And, to be fair to some of the smaller firms....at least get to know the owners, meet with them, make sure they're not just a sub group or something. This is how some firms defer liability for cash from their traders or vendors.

  6. LOL...Again with the "balance sheets" schtick, Don...doesn't it ever get old? It's ridiculous how you skew all your criteria to the exact business model of Bright.

    Anyway to the OP....

    Look for solid reputable firms that have been around for years (and don't listen to Don's b.s. about self clearing firms....Assent clears about 10% of all NASDAQ and NYSE volume).
    The most important issue after that should be speed and reliability of the trading platform, and then commissions.

    I agree with Don about the sub group offices....avoid them. There is nothing they can offer that the main firm cannot give you (and the sub groups are not covered by the main firms $$$$....avoid at all costs).

    Good luck.
  7. Mr. Long horns ...I'm sorry, I just cut and paste sometimes. I think we agree more than disagree, and Sungard is still a public company I think, so therefore there financials are public records.

    I've never had concerns about Sungard/Assent...at least not since they took over Andover.

    Don :)
  8. I was just busting chops (as usual). We definitely agree more than we disagree.

    Good luck.
  9. Glad to hear it, and a correction. I remembered something about Sungard being taken over by some hedge funds. And, it appears it was in 2005.

    Formerly listed on the NYSE (ticker symbol SDS), on March 29, 2005 the company was acquired by a consortium of seven leading private equity investment firms in a transaction valued at $11.3 billion, the largest such transaction to that date. The partners in the acquisition are Silver Lake Partners, Bain Capital, Blackstone Group, Goldman Sachs Capital Partners, Kohlberg Kravis Roberts & Co., Providence Equity Partners, and Texas Pacific Group. There had been plans to separate the availability and processing businesses, but the new owners have not carried this forward. I guess they took Assent as well.

    Hard to keep up sometimes, LOL. Generic/Carlin to RBC, Echo to Merrill Lynch, makes one wonder.

  10. Do any prop firms force their own trading strategy?
    #10     Sep 6, 2007