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As a corollary to this, I would say where you live doesn't matter either. If you are executing your trades manually, then you are the slowest point in the execution chain, regardless of where you live. And if you are executing automatically, then you can easily put your trading program on a...

Thanks! And that's great to hear that MS RD is faster on the client end than VNC.

Thanks, Prophet. The Microsoft website says MS RD is built into Windows XP Pro and ServerBeach offers Windows 2000, Windows 2003, and Windows 2003 Web Edition. Which version of Windows do you have on your servers? Does that version include MS RD? Is it possible to get MS RD separately...

Nice! Thanks, Gordon. I hadn't heard of VNC before. Now if I could install software on a remote server from my local CDrom drive, I'd be able to set up automatic trading on a server. With the 99.9% advertised uptime for these server farms, this would be a lot more robust than over DSL or cable.

How do you install software on a remote dedicated server? Can you install software from your local CD-rom drive? Can you connect to a server and run applications on the server and "see" the server's desktop? Kind of like you can "see" the desktop of another computer using PCAnywhere? Is...

Great article, kc11415. It took me a couple hours to read it all, but it was fascinating. I'll have a new understanding of what car salemen are doing next time I'm at a dealership. Thank you for the reference.

The NFA requires commodity trading advisors and commodity pool operators to have a disclosure document, often called a d-doc. It doesn't sound like your friend is a CTA or CPO though. :confused:

Your main costs are NFA membership, CFTC registration, disclosure doc preparation, accounting, computers, data, and software. Other than the NFA and CFTC registration, these are variable costs. How much you spend for startup and maintenance depends on how much you can do yourself and what kind...

I went with a sole proprietorship just because it is easier. I had enough to do with setting up the limited partnership and CPO. I've recently registered as a CTA and eventually I'll turn Schindler Trading into an LLC. Sole proprietorship is just the simple thing to do and you can always...

No, a disclosure document does not remove all liability — not for a sole proprietor or any other entity. It helps though. If you are concerned about personal liability, you might consider using an LLC for your trading business. There are other asset protection strategies that involve...

The CTA fees get paid to Schindler Trading. Schindler Trading is my sole proprietorship. If Schindler Trading were an LLC, then I could either pass the fees through to myself or pay myself a salary. I'd probably pay myself a salary to the extent I could stash that salary in a qualfied...

Good question. Even the SEC is struggling with this. The SEC thinks they might want large hedge fund managers to register with them. Now they have to define what a hedge fund is. "Hedge fund" is not a legal term and there is no codified definition. A hedge fund is a private investment...

Are you talking futures broker? Sure, most other brokers besides IB should be good for multiple accounts. They should have the capability so that you can execute one trade of multiple contracts and then have those contracts allocated to the separate accounts according to some allocation...

I've got two brokers because one client wants Schindler Trading to use a particular IB — one that they own. I would have preferred to not add another broker, but it isn't a problem.

I currently execute through two different brokers and it isn't bad. The fewer the better, though. One nice thing the futures industry has to make things easier is the "give-up". If you have your account at Goldman Sachs and I want to execute through Man Financial, for example, I can ask Man...

Sorry. FCM is futures clearing merchant. Your introducing broker (IB) is the firm who you will execute your trades through and your FCM will clear your trades. The FCM is the one with the exchange memberships and who holds your money and posts performance margin with the exchange clearing...

Schindler Trading is a CTA. We manage both separately managed accounts and a fund. Since we manage a fund we are also a registered CPO (commodity pool operator). It takes more work and startup capital to form a fund and comply with all the regulations. Funds also need to be audited and...

Schindler Trading doesn't have a lockup. (A lockup is a period of time after an account is opened during which no withdrawals are allowed. One year lockups for hedge funds are common.) The reason Schindler Trading doesn't have a lockup is two fold... One is that we trade very liquid...

No, monthly performance fees haven't been an issue. We report our results monthly and provide monthly liquidity (chance for additions and withdrawals). Anything other than monthly fees would be confusing and difficult. Imagine charging quarterly performance fees. What if January and...

There's no standard way to calculate the performance fee. It could be monthly, quarterly, or annually. A highwater mark, sometimes with a hurdle rate, is pretty common. The percentage varies a lot — I think Steve Cohen and SAC get a 50% performance fee. Schindler Trading charges a 20%...