Are Any EliteTrader Users In A Prop Firm? What Are Your Returns Like?

[Fonz]

When you trade for a living (prop firm or you your own proprietary capital), daily, weekly and monthly risks, profit and loss, are what matters. Leverage is a tool, just a way to apply your short term strategies.

When you invest in the market for growth or/and dividends, leverage is a risk. The total capital with leverage should be taken into consideration to calculate ROI.

ROI = Return on investment. Trading for a living is not an investment, it is a full time job.

 

[punisher]

there is a return on your contributed capital.
then there is the return on assets (contributed capitals +loan)to create the income stream. income stream is reduced by interest paid on loan.

stop making it like it is some freaking rocket science. Leverage works both ways, multiplying profits and losses, so if you have your game right who gives a &$^* what your notional value is.

And the end of the month or year calculate your returns after all fees paid and you get your return. But then again who give a &#^$, it's not a pissing contest. As long as you make what you need to or are happy with, you're all good.

Some are banging for 10 hours straight, others do only 60-90 minutes from the open. Some can tolerate bigger swings in their accounts, others not. There are no reasons to compare % returns but if you really need to it is a freaking simple number.

 

[zdreg]

stop making it like it is some freaking rocket science. Leverage works both ways, multiplying profits and losses, so if you have your game right who gives a &$^* what your notional value is.

And the end of the month or year calculate your returns after all fees paid and you get your return. But then again who give a &#^$, it's not a pissing contest. As long as you make what you need to or are happy with, you're all good.

Some are banging for 10 hours straight, others do only 60-90 minutes from the open. Some can tolerate bigger swings in their accounts, others not. There are no reasons to compare % returns but if you really need to it is a freaking simple number.

the original post referred to working for a prop firm. what you do on your own is your business. for a prop firm the key phrase is risk management.if you want to work for a prop firm your response will be regarded as trash talk by management

 

[Rationalize]

I'm unsure I believe all of the above.

A couple of guys I used to work with, who've been booted from institutional desks for various reasons have briefly sat in prop shops, in-between careers.

Story I've heard is more of a room full of sweaty young guys desperate to be traders for ego reasons / bragging reasons, more than financial reasons, spending all day watching ladders of bond futures (bills / notes / bonds) .. with the occasional old old floor trader lurking around and telling war stories.

Leverage being given out in a miserly way, such that they barely make enough to live.
And -stories- about the top dogs killin it.
Profit split being something like 50/50, but, a commission margin being applied to the traders trades, and a clearing fee. Profits being paid out only when the trader has establishes a certain cushion size - which may take a year to build up.

All in all, it seemed to me that guys who want to do prop are just as well off saving up say $50K in a regular job, and then getting their own leverage through a regular broker (like interactive). Commissions seemed similar in certain products, and you have more control about what you trade and which timezone.

My conclusion was, so long as you have some strategy / experience already, then trading your own account is as good an idea as working in a prop shop.

 

[Overnight]

...
My conclusion was, so long as you have some strategy / experience already, then trading your own account is as good an idea as working in a prop shop.

 

[punisher]

the original post referred to working for a prop firm. what you do on your own is your business. for a prop firm the key phrase is risk management.if you want to work for a prop firm your response will be regarded as trash talk by management

I can't comment on what prop firm priorities would be, but I don't see anything wrong with your above statement. However if the risk was your main focus you should have stated it clearly beforehand. Instead, all answers regarding the returns you called pathetic providing your version of how to calculate returns. In a prop you are given capital (a prop that requires your own capital is not a prop) and calculating returns is simple and that's why I responded why are you making it so complicated.

I'm sure there are metrics that would focus on risk involved in making those or any returns, but calculating return on capital is as simple as it can get. IMO that's what OP was asking about. It doesn't matter what prop's cut on the profits is, it doesn't matter what is the cost of that capital.

People usually ask those kind of questions to get a measure of what is possible to make in the markets (daytrading) and something to shoot for. If one asks general question about returns from trading the markets, he will get flooded with examples of fund manager's performance like it was of any relevance to compare multi billion dollar fund's performance, managing other's money (therefore low tolerance for drawdowns) with a performance nimble daytrader with sub 1$mil account.

 

[punisher]

All in all, it seemed to me that guys who want to do prop are just as well off saving up say $50K in a regular job, and then getting their own leverage through a regular broker (like interactive). Commissions seemed similar in certain products, and you have more control about what you trade and which timezone.

My conclusion was, so long as you have some strategy / experience already, then trading your own account is as good an idea as working in a prop shop.

First you need to get that experience somewhere and of course the capital.

A prop where you need to contribute/put up capital is not a prop, it is a scam or whatever.

If you have your own capital you may as well blow it entirely while learning. So even if conditions at the prop where what you described, it's still not a bad deal. You learn on someone else's dime. Even if there are no pay outs for a while (and that would assume one is profitable), it is still better for some to learn the markets while burning other's capital. If at the end of the contract one feels he/she is ready, has enough capital and doesn't like the deal, what stops them from leaving?

I don't know much (or at all) about prop but people usually comment what seems to be fair or not but that's not objective if they don't want to look at the other side of that (or any) business and what it takes to run it.

 

[Rationalize]

Unsure there's much to learn at a prop firm.
Punting rate futures tick by tick is a computer game.
Trading news is best done by insiders.

Experience inside a brokerage is worth something, as is stat arb exposure imo.

Market maker prop companies could be worthwhile i guess.

 

[Willba]

Im at a prop shop, and its simply what you want it to be. Yes I cut my teeth on interest rates, now I work on Oil, Emin, Currencies, and soon some commodities.

Never provided capital, and yes profit share is in place.

 

[Rationalize]

Im at a prop shop, and its simply what you want it to be. Yes I cut my teeth on interest rates, now I work on Oil, Emin, Currencies, and soon some commodities.

Never provided capital, and yes profit share is in place.

Anyone trading SPI successfully at your shop - other than at the open and close?