Any firms out there that are created for position traders

Quote from sltrader:

I agree but it seems like a certain hyperactive trading style is in your best interest
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Very few of the old "hyper" type "video game" day traders around. Most have adabpted to doing openings, MOC's, market making, etc. If the strategies work, they tend to trade a bit bigger size (get costs down), they do better, they stay a long time. Heck, we have guys who trade a couple million shares just doing opeings...as I'm sure Lescor and MSchey can attest to that as well.

FWIW,

Don

edit: Regarding Schonfeld, has always been a respected firm. We have a lot of guys from there. Their only negative was, of course the split, and the "deferral" of income. Of course I don't specifics, since my guys have been here for a while..and, things change everywhere.

If you're giving away $10k per month vs. putting up $20K or so... I guess it depends on the individual.

But, like I said, Steve Schonfeld is highly respected in the industry.
 
I have a different view than most about the split. Although I do enjoy the 100% payout; sometimes I think it may be worth it.

If someone wants to help me add to my pie(so to speak) I have no problem throwing them a bone. My old firm wouldn't let me hold large positions long term. There is ONE they let me but they bitched at me everyday for doing it.

Lets take RBC for example. Even if I have to put up my deposit but the extend me leverage much more than 20:1 and allow me to hold longer term positions, that will ADD to my current income, why is it such a big deal to throw them 20%. They are taking on some risk too more than I would be.

For example, in 2006 I wanted to buy 127,000 shares of EQ at 40.23 and I had protection if it dropped below 39.90 and I had a price target of 53 bucks. If they would have let me hold that, I wouldn't have a problem giving them 20% of the profits, they are allowing me to add to my pie. Make Sense?

If they are giving you opportunity and supplying me with tools (in this case money); where I am in fact making more money, why not.

Say a person is making 250k now. And they go to a shop and that allows the person to even make double their current income; 500k. Even with a deposit they are taking EVEN 30% you are banking in another 100k. But I know that you can work up a deal with RBC and others and have a 80/20 split. So in that case you would make additional 150k a year. not bad?

Its all about the pie.
 
it seems to come down to different strategies RBC from what i understandpromotes longer term trading rather than the pairs scalping opening and other intraday stuff that goes on at most places so if RBC seems to be less interested in commissions and more interested in traders making a lot $
 
For discussion sake, and I had a nice lunch with my friend David, who is the Managing Director at RBC Carlin, and a good meeting with Don Shear who sold Generic/Carlin to RBC.

It's about allocation of capital, risk management, cost of capital use...not about how long someone holds a posiiton. The primary purpose is for traders to make money, those who trade more will obviously pay less per share, but profits and longevity are the motivating factors for firms and traders. Traders need to make money, firms have to allocate capital and manage risk. In our case (we're not owned by a bank or brokerage or a software firm), we use our experience to make these decisions.

The example of using over $5million to buy 127,000 shares of something, means simply that there is $5million being used for a directional bet. I'm not sure of the downside risk, but I give the poster the benefit of his ability to limit losses. $5million, assuming $250K or so in account would cost the trader about 1 percent per month in haircut ($5,000), and about 4% in interest per annum, or $3333 per month for a total of $8333 per month. Now if the stock went up only $5 (not the higher price target), for a profit of $635,000 on 254,000 shares traded, not bad. 20% of $635,000 = $127,000 paid to the firm, plus commissions vs $8333 per month for carrying costs. I have no way of knowing how long that trade would need to be held, but let's assume 6 months.... 6 x $8333 = $49,998, again vs paying 20% or $127,000.

I'm just trying to show you a thought process, and of course there are other variables involved, and many possible outcomes, but this is a way of approaching it.

FWIW,

(Better double check my math, I've been trying to trade and type at the same time, LOL.

Don
 
Quote from Don Bright:

Isn't 1% of 5 million is 50k right?

For discussion sake, and I had a nice lunch with my friend David, who is the Managing Director at RBC Carlin, and a good meeting with Don Shear who sold Generic/Carlin to RBC.

It's about allocation of capital, risk management, cost of capital use...not about how long someone holds a posiiton. The primary purpose is for traders to make money, those who trade more will obviously pay less per share, but profits and longevity are the motivating factors for firms and traders. Traders need to make money, firms have to allocate capital and manage risk. In our case (we're not owned by a bank or brokerage or a software firm), we use our experience to make these decisions.

The example of using over $5million to buy 127,000 shares of something, means simply that there is $5million being used for a directional bet. I'm not sure of the downside risk, but I give the poster the benefit of his ability to limit losses. $5million, assuming $250K or so in account would cost the trader about 1 percent per month in haircut ($5,000), and about 4% in interest per annum, or $3333 per month for a total of $8333 per month. Now if the stock went up only $5 (not the higher price target), for a profit of $635,000 on 254,000 shares traded, not bad. 20% of $635,000 = $127,000 paid to the firm, plus commissions vs $8333 per month for carrying costs. I have no way of knowing how long that trade would need to be held, but let's assume 6 months.... 6 x $8333 = $49,998, again vs paying 20% or $127,000.

I'm just trying to show you a thought process, and of course there are other variables involved, and many possible outcomes, but this is a way of approaching it.

FWIW,

(Better double check my math, I've been trying to trade and type at the same time, LOL.

I am doing some other things are well but isn't 1% of 5 million 50k?

Don
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Quote from prof. charles:

they dont take deposits and they will give you plenty of overnight buying power if you have good track record. they usually start people at $2MM buying power and that can be employed however you want.
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Which firm provides what you wrote? I emailed Schonfeld and they told me they're intraday only, but I'm interested in hearing of others.

Thanks
 
I think the bottom line is that, once you are a successful trader, you can find the deals that make the most sense to you whether it is working for a split or 100% on your own.
 
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