7 Figure traders

jasonc said:
This isnt entirely accurate, the part about how they wouldn't sell strategies is very true but why they would stay at a prop firm there are many reasons. I worked at a prop firm and saw multiple traders who made 7 figures and stayed.

Reasons:
- Lower commission agreements due to size of prop firm
- Strategies were arb based or required large amounts of intraday capital which the prop firm could provide. Traders kept 500K in account to use 20x intraday for strategies which they couldnt get other places.
- Set up to use prop firm trading systems which makes it a pain to move
- Better market access or more market access than they could get at other shops.

Prop firms are effectively your own small business, they have a number of benefits but no firm will provide you a system that will make a lot of money.
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would someone care about commissions fees if he is making 7 figures?
would it matter for him if he pay 10K commissions at the end of the year?
 
I was contacted several years ago by SMB and was asked to teach spread trading for them which I declined to do. Their roots are in stock trading courses and stock trading. I am not at all sure if these are the same firm principals.

As a general side note there was in the past regulatory issues with mixing educational course funds and stock trading account funds in the proprietary trading industry.

I see that they offer a $1475 Market Profile course in the SMB education division.

They seem to want to expand into futures aggressively, but there are regulatory issues with futures proprietary trading that are very much different than equities proprietary trading. You can only risk the firm's capital with exchange registered proprietary futures trading.

Long established proprietary futures trading firms like DRW or Jump or Prime (there are more) for example are not going to charge a new hire for training.

I have seen in the past some Chicago area prop firms (no longer around) that taught their traders the same strategies and methods (Goldenberg Hehmeyer most notably) and even berated traders for deviating from them. As you can imagine, when the firm had a bad day it was a really bad day.
 
Having read a lot of trading books in my life, I can tell you that SMB's Bellafiore "One Good Trade" is a must for intraday traders. I wish I had read that when I started.
 
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Daal said:
Having read a lot of trading books in my life, I can tell you that SMB's Bellafiore "One Good Trade" is a must for intraday traders. I wish I had read that when I started.
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so i searched and downloaded the pdf of this book and read it. what did you get from it, more the psychological aspects?
 
jasonc said:
That is not true at all, and your missing a fundamental point where I could buy the 500 S&P 500 underlying stocks and replicate the index while shorting the futures for a hedge and the basis risk is almost zero. If I did this as 20X and then only had a difference of one name that repeated .5% of the portfolio to capture an arbitrage strategy the risk is very minimal. These don't make you rich instantly or cause the blow up your describing.

I think important for traders to realize all leverage is not created equal so you need to take an honest look at how spread out that risk is and how it would respond with large moves.
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Exactly. Leverage constraints are due to idiots who trade high leverage and high correlation, properly used it's a different story.
 
mr_byte31 said:
would someone care about commissions fees if he is making 7 figures?
would it matter for him if he pay 10K commissions at the end of the year?
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Expenses, so also commissions, should be seen in relation to profits.
If you pay 1 million in commissions and make 1 million, your commissions are relevant.
If you pay 1 million in commissions and make 10 million, your commissions are irrelevant.

In every kind of business you have income and expenses. First rule is that income should always be bigger than expenses.
 
MarkBrown said:
so i searched and downloaded the pdf of this book and read it. what did you get from it, more the psychological aspects?
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It highlights pretty well traits a good intraday trader needs. It also shows well how to think as a trader, in particular his emphasis on "if then" statements. His daily report card idea is also pretty good. There are a lot of great habits to be picked up there
 
Daal said:
It highlights pretty well traits a good intraday trader needs. It also shows well how to think as a trader, in particular his emphasis on "if then" statements. His daily report card idea is also pretty good. There are a lot of great habits to be picked up there
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For me trading is not about psychology, habits or discipline. Its mostly about solving problems. If you have a consistently profitable strategy you will have no problems executing it no matter what.

Yeah im totally in the camp of the more leverage the better
 
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