Randomly came across this thread while looking for something else. As someone who has traded on a real prop desk for over 6 years, I have to wonder how many here actually have prop experience?
It's true, these firms are nothing like a real prop. But at the same time, the prop trading world I've been a part of is simply not open to most traders, successful or not. You have to know someone to get an interview. Even profitable traders get turned down - or worse, they get brought in and forced to trade a different instrument, etc..
Of the lot of the online funding companies, Earn2Trade strikes me as the most similar, since 1) you actually can qualify for an account with two separate prop firms that exist all on their own, and 2) That account, through their TCP evaluation, can be a"$400k" account with a $25k static drawdown limit, real live money.
My first real prop firm experience was just that. I was given a $25k noose to hang myself and a daily loss limit that started with a couple hundred a day and was adjusted up as I showed some promise. Meanwhile, seat fees, etc., accrue against your balance, separate from that 25k.
To get paid you have to overcome both losses and fees. The fee gets taken out after your split, which was 40% at that point.
Most people fail that account and bust out, they never make it back to breakeven. 1/5 at best makes it back above breakeven and gets a paycheck. One paycheck. 1/5 of those is still there a year later.
At the time, I was told the fastest anyone had been paid was 6 months. I got a tiny check after 5 months. Subsequent checks were much nicer. I lasted 3 years at that one, left to form an RIA.
That's the way it goes...trading is hard and most people can't cut it.
Firms that do it that way sometimes also take a cut on commissions. Mine didn't, but many of the "legit" firms do.
With something like E2T if you look at an 80% split vs 40-50% split (most recently I got 50% and had about $5,000/mo in fees), the end result could actually be more favorable. You definitely have to jump through more hoops to get there, BUT, it's open to anyone who wants to give it a shot. And you don't have to deal with a boss, which can add a whole other dimension to trading. Especially if that boss is a non-profitable trader and is free to f--k with you as much as they want.
Just my .02
ETA: that $5,000 in monthly fees is in addition to commissions and per-share/contract exchange fees.
