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I am considering setting up a prop-trading company with $200k of my own capital to raise assets of around $1-2m from investors, giving me around 40% of shares and profits of the company. My impression is that everyone is dreaming of creating a hedge fund whereas, for small capital and the...

@Tradovate How will this work exactly? Could you describe in detail using an example, please?

It is not a bucket shop - it is a different structure, an OTC market. Biggest hedge funds trade swaps with their prime brokers - in essence, it is also an OTC trade and they count on the prime broker to pay out. Option 1 is Advanced Markets UK (although they have also an entity in the U.S. and...

Interesting excerpt from FIA FAQ: " Would a separate Customer Account maintained solely for the benefit of one customer allow suchcustomer, in the event an FCM were to become insolvent, to avoid sharing pro rata in any shortfalls as required under the Bankruptcy Code? No. In adopting rules for...

I am about to make a choice between two setups: 1. USD kept at a UK escrow account linked to a UK CFD broker (my funds are in theory fully segregated and the broker debits/credits the account for PnL generated) 2. USD kept with a U.S. FCM in an omnibus account (my funds are commingled with those...

What is the first sentence of your reply about? What is TCP? Custom account - what can be its parameters?

Will your business model ever allow to be competitive with all these fake FX "prop-firms" in terms of risk capital a trader gets? In other words, will we ever see you offering a $40,000 risk capital for a fee of around $2,500 like some FX "prop-firms" do?

Bullshit action - got in @ 1.14225 going to 1.15290. Then it will drop to 1.13480 anyway. Then on to 1.1700

Update - now we are aiming entry at 1.13480, target 1.17000

OK. It is either 1.13790 or today's close that we go long at. Stop at 1.12990. Targeting 1.15290. More to come on the way up if it plays out with today's low as the stop.

@Rapunzel What are your plans on how to raise capital from clients? Do you think a CTA registered in the U.S. (and authorised again in the UK if you are going to approach British clients) is a better option? Did you think about Irish ICAV?

Actually, Mr Market might be generous enough to drop to 1.13460. Stop would then go at 1.12480. Investment committee will review its recommendation again on Monday

It is just my 1-person investment committee's view - there is a ban on going short this market for now :) Unless from 1.1550-60 with little size A little update - might reach 1.1550-60 next week then down to 2021 yearly close at around 1.1376-80. I am now resting my limits at 1.1380. Anyway...

In trading, there are many things that are completely illogical. This is also certainly true in money management business. Take Melvin Capital: lost more than 20% in one month last year - they got "reloaded" by investors. Now they lost again - yet still are in the business charging their...

What is happening is the following: EUR/USD is going to 1.1700-1.1800 first (should not drop below 1.1300 in the meantime), but not as high as 1.2100. Then the proper multi-year down trend resumes, ending the year below 1.1000, with low for the year below 1.0700. Next years it will move to...

I think I will settle on the time-weighted method and VAMI suggested by the NFA for CTAs. If I become one one day it will come in handy

How do you calculate Rate of Return (ROR) in trading? Did you think about how unobvious it might be? For instance: You starting equity on Mar 1st was $100k. You made $15k in net profits during the month. You also paid in $10k of additional capital on Mar 5th and paid out $30k on Mar 25th. Your...

This guy seems to know what reality looks like for raising assets when you are starting out: How to Start a Hedge Fund – and Why You Probably Shouldn't (mergersandinquisitions.com) So no other way to trade one's own limited capital I guess, looking for 1000%/month...

I am looking at a CTA database and I see that some of them have been in business for 10+ years, yet still have only less than $10m in AUM, charging 2/20%. This just adds to my pessimism when it comes to starting up my own CTA as I just do not believe this is a sustainable business model unless...

For safety of funds purposes I want to trade using two different FCMs. What is the best way to trade in such circumstances? I am considering two approaches: 1. Divide funds 50/50 and trade certain symbols with FCM A and others with FCM B - would need to rebalance the funds frequently to keep...