Bright Trading's new payout model
- Thread starter Maverick74
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All I can say a this time is that we are working on ways to work with our traders to maximize their overall proftis.
Don
No number was specified, we are still waiting for letters from regulators...will post more when I can.
Don
Quote from Shreddog:
You could always lower their commissions.......
For obvious reasons, I can't talk about here on a public board.
Don
Obviously it's NOT a regulatory decision and a broker one, probably forced upon them by GS raising their costs at a level other than base commissions, where at 2/1000 or whatever it is, BT isn't making enough money with the low volume and volatility levels the market is running these days.
I highly doubt this 80/20 decision is being made to increase the trader's profits. Since when does a broker ever think of anything but its own bottom line first.
Please. If I'm doing 1M+ shares a month at 1/1000 or 2/1000 or whatever, the broker is making a killing on my account. The problem is these prop shops are full of rookies with very little experience and a risk aversion level so high they aren't using enough capital to make money on the interest charges side, nor are they generating high enough commission volume, nor are they likely profitable.
I've sat down next to arrogant assholes with more cash than brains telling me this or that of what the market will do and why, analysing the charts like they were reading The Matrix, telling me I'm all wrong, but end up negative loss five days in a row for having no discipline or balls to make the right decisions when. And when the inevitable "prove you're smarter than me" challenge comes, I'll do just that, make a decision, set a trade, hit enter, and cash out net profitable. It takes a few days before they come around to apologise, but they always do.
You don't have to have a PHD in Mathematics to be a great trader. Great traders are as rare as great athetes, great doctors, great lawyers (well, no, lawyers are all scum, but you know what I mean), great whatevers.
This whole prop discussion is, again, making me sick reading it. The model is a dog. Move to a hedge fund prop model. Dump the dead weight, stop trolling the bottom for scalpers, start paying good traders what they're worth, dump a ton of capital on them, buy them the best systems, software, and let them run.
Or get the hell out of the way for those who can. And will.
I highly doubt this 80/20 decision is being made to increase the trader's profits. Since when does a broker ever think of anything but its own bottom line first.
Please. If I'm doing 1M+ shares a month at 1/1000 or 2/1000 or whatever, the broker is making a killing on my account. The problem is these prop shops are full of rookies with very little experience and a risk aversion level so high they aren't using enough capital to make money on the interest charges side, nor are they generating high enough commission volume, nor are they likely profitable.
I've sat down next to arrogant assholes with more cash than brains telling me this or that of what the market will do and why, analysing the charts like they were reading The Matrix, telling me I'm all wrong, but end up negative loss five days in a row for having no discipline or balls to make the right decisions when. And when the inevitable "prove you're smarter than me" challenge comes, I'll do just that, make a decision, set a trade, hit enter, and cash out net profitable. It takes a few days before they come around to apologise, but they always do.
You don't have to have a PHD in Mathematics to be a great trader. Great traders are as rare as great athetes, great doctors, great lawyers (well, no, lawyers are all scum, but you know what I mean), great whatevers.
This whole prop discussion is, again, making me sick reading it. The model is a dog. Move to a hedge fund prop model. Dump the dead weight, stop trolling the bottom for scalpers, start paying good traders what they're worth, dump a ton of capital on them, buy them the best systems, software, and let them run.
Or get the hell out of the way for those who can. And will.
Quote from Shreddog:
You could always lower their commissions.......
After we receive the proper legal letters etc. from the regulators, I'll post up what I can.
And, as amazing at it might sound, I actually agree with portions of what the above poster said about "dead weight" and "successful traders."
I have helped Million $$ traders move capital to retail accounts, while keeping them on board for their more leveraged trading... so that they can stay in contact with the "Mother Ship" and be part of the team to continue making the money that allowed them this freedom. A good trader, with adequate capital, doesn't need OPM after a certain point, and would be foolish to use it.
All the best,
Don
CNBC with Bob Pisani and Dennis Dick (11 year Bright Trader). Good interview about the flash crash.
I think I have the video at home and will post to website soon.
Anyone catch it? (Other than the dozen calls just received, LOL).
Don
I think I have the video at home and will post to website soon.
Anyone catch it? (Other than the dozen calls just received, LOL).
Don
Tell 'em to dial up EliteTrader.com:
Flash Crash Report Coming Soon
Friday, 3 September 2010 2:30 PM ET
<embed pluginspage="http://www.macromedia.com/go/getflashplayer" allowfullscreen="true" allowscriptaccess="always" bgcolor="#000000" quality="best" salign="lt" type="application/x-shockwave-flash" name="cnbcplayer" wmode="transparent" src="http://plus.cnbc.com/rssvideosearch/action/player/id/1582048337/code/cnbcpermalink/play/1/module/videoModule" height="370" width="580">
Discussing what the SEC rule changes will recommend, with Larry Tabb, The Tabb
Group and Dennis Dick, Bright Trading.
Source: CNBC.com
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