Chicago WTS Open House - Jan 17th

Bro59,

Good point about it being a job. It is more a career than a job. If you sit home all day and successfully trade your IB account can you say you are a trader? I think so. Either way it's semantics.

You cannot compare Tuco and WTS. Or for that matter any non registered entity (like Cy Group or Lake Street) versus a CBSX BD. Tuco's structure was illegal (as is Cy and Lake Street...they need to register as a BD). WTS is an SEC registered BD. That difference cannot be overlooked. To say that WTS was set up to side step the PDT is the same as saying Goldman Sachs was set up for that as well. Both are SEC registered BDs.

However, as it has been pointed out Madoff and MF Global were also SEC registered!!



Quote from bro59:

I for one appreciat SgtSlottter's comments here. I also appreciate that Barron allows these posts to remain. Although some of this may be contentious it is important that ET allow the debate.

I don't mind that firms creep around the periphery of legality in order to sidestep what at times are silly rules imposed by an uninformed US Congress (ie the "daytrade rule"). When this behavior turns predatory or becomes false advertising is when the whole game turns sour and is unacceptable.

Really, the terminology on the issue of a trading "job" should be changed with regard to these prop firms. Junior members need to realize that they are being asked to contribute cannon-fodder capital to many of these firms and that they have no recourse if the Class A members are unscrupulous operators. A case in point of this is when Tuco went down, the capital was tied up, nobody could trade, but Doug (Class A money) was paid multiple $10,000 consulting fees during the settlement period. Clearly in this case the interests of the founding partners and of the general pool of traders had strongly diverged.

It is difficult enough to succeed in this endeavor without your firm working against you so make sure you know where you stand, which is SgtSlottter's point, even if he does have an axe to grind with WTS.
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Thank you. I am just trying to point out obvious questions which should be asked. I am not sure why some people get so pissed and keep saying go away go away.

Everyone should look at public info themselves. The SEC's website offers balance sheets and other information from all registered broker dealers.

That being said, the one question that needs to be answered by all BDs, WTS and their subgroups included, is what % is class A capital, and what % is class b (or trader) capital? The reason the question is necessary is that it is not required by the regulators to be disclosed since both A capital and Trader 'capital contributions' are part of the firm's capital base (thus if the firm is running on fumes, there is nothing stopping the firm from using the trader capital for operating expenses, including salaries, rent etc.). When you put money at a prop BD, it is NOT a customer account, and it becomes part of the firm's capital, thus you don't have the protections like SIPC etc. And if the firm overspends money, let's say for example opening an office in Chicago and flying their 'sales and human resources' guy out there, then that could be - with no hesitation or anyone looking over their shoulder - your money being spent.

If it were me and I didn't ask, and something happened, I'd feel stupid. Also, if I got terrible training and had money locked up, I'd feel stupid. If I did ask, and got a good answer, I'd feel good and comfortable.

Ask the questions. WTS and every firm should have easy, up to date answers they're willing to put in writing. If they won't do that for you, steer clear.
 
SgtSlotter,

Blah, blah, blah. We are so lucky we have a failed trader as our guardian angel to protect us from the big bad WTS.

Shouldn't you be closing a mortgage or two? Or did you fail and selling mortgages as well?

What's next, selling insurance?
 
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