Another newbie

[monty21]

The best way to know whether the firm is reputable is to find people that work[ed] there currently/formerly. There is a good chance you will find one on ET that will share his experience.

Also, I tried to answer your questions in my second post. Regarding you're question of whether you will get fired or will own the firm capital if you lose, that all depends in your contract. It varies, so that's a question you need to ask them. If you're asked to sign something, make sure you read any document fully. Some people surely aren't honest.

I can't give you an overall opinion of whether it is a good deal because the most important criteria is the firm itself. The payout, commissions and training appear average. You also need to ask about other fees, such as technology costs (if any) and membership to exchange, etc. You only provided a minimal amount of information.

Take my advice as one opinion, nevertheless...
Best of luck

 

[kodatius]

Ah i thought i wrote that i need to get my series 7 done, which they will sponsor completely. Technology cost is a good question that i dont even know, i just assumed that joining the firm the only thing id have to give is the 5k and everything else i believed was included. I do know there are no per ticket charges if that helps. Monty, thank you again for your advice, its definitely been beneficial.

 

[monty21]

Some firms require Series 7, others don't. It's actually not necessary to trade a private account (firm capital) unless there's outside investors. Series 7 pretty much deals with customers. Still, this is the decision of the firm. Traders that have Series 7 are more "reputable" and legitimize the firm somewhat.

Also, is the firm only paying for the books? The actual test is expensive ($250). That test is also very, very, very difficult. Professionals frequently fail during their first attempt. If you're new to the markets, start studying as soon as possible.

http://www.investopedia.com/professionals/series7/

In terms of technology fees, many places charge you in order to have a "seat/desk" at their firm. You also pay for the actual technology (computer, software). Some places are totally free, others charge $50+ (month). Places that do charge tech fees generally waive these fees if you are trading a lot (you're providing them commissions).

What can also be expensive is membership to Nasdaq and Nyse. Ask if there are any fees. It may cost over $100+ a month to belong to them and be able to trade. This is common, but the more respectable firms don't have them.

In sum, you must question about the fees. You won't get any training for your 5,000 because you will blow it too rapidly because of the inexperience and the fees. Trust me on that.

Don't look at prop firms at a place where you have a job. Instead, your essentially their customer. They provide you with a service (firm capital) in order for you to trade and attempt to be profitable. If you fail as a trader, that hurts you much more than it hurts the firm (they will close the account as soon as your in the minus aka lose over $5,000). If you're profitable, both win. Advantage = prop firm. Remember, your paying for services!