Funding new traders Search for a better business model

traderjo said:
3 mentioned on this forum all the time! but then again you are going to say like Mav that two separate entities, one either selling education or test and one actually a Futures prop so perfectly legal I suppose ;)
Meanwhile thousands of suckers go through burning hundreds each month hoping to get Funded! and that is perfectly legal too!
you guys are more experienced than me so on legality of it all I take your point , but how ethical all this is is a big question and many half decent people who do their due diligence can see the red flags IMHO

These following guys must be idiots who dont seem to charge anybody any test money for aspiring traders.. damn must write to their CEOs about this golden opportunity they are missing!
https://www.optiver.com/ap/en/job-opportunities
https://www.flowtraders.com/careers
https://www.tibra.com/careers/
https://propex.com.au/trainee-traders
https://www.citadel.com/careers/
https://b2tradinggroup.com/jobs/
More...

The ethics of what? You want a job at Citadel? Great, go apply. I hope you graduated from a top 10 target school and graduated at the top of your class at that school. Plus you better have 2 or 3 bulge bracket internships in your back pocket and preferably a couple of letters of recommendation. Also, good luck on the stats and probability tests you will have to take just to make it through the first interview. I can't believe you are comparing firms like T3 to Citadel. Shit, Citadel wouldn't even return Scott Redler's e-mails for an interview.

Look, if you are asking me for advice I will give you the same exact advice I have given to every single person on this forum that has asked me both publicly and privately. Get into the best damn school your grades will allow. Take a LOT of math and stats courses. Learn at least "some" programming like R or Python. Then interview like crazy. It's still a long shot but at least if you fail, you will be well qualified to land any number of decent high paying jobs out there in data analysis or risk.

Let's be honest, the reason guys go to firms like T3 or any other firms that offer a "shortcut" is because they simply don't have the resume. Do you really think you are going to chart your way to billions at these bucket shops? It's a serious question. If you do, then by all means, you only live once, go for it. The so called victims who fall for these traps are not victims. They are not turning down offers from Goldman, Citadel or DRW to flip shares for T3 or tick f*ck futures for TST. They are doing it because they have no other choice. They are broke and they have no education. I do feel for these people, don't get me wrong. But if they live in the US, they have endless amount of resources. The catch is it requires a huge amount of work. But nobody wants to put in the work, so they sign up for get rich quick schemes. Are they really victims or just lazy?

And btw, there is a cost to get into firms like Citadel. It's a 150k education from the University of Chicago and probably several thousand hours studying in the university library. You want to pay $200 to pass a combine. Sure looks easier doesn't it? Don't tell me you can't get into a good school. You can, you just don't want to.
 
Maverick74 said:
The ethics of what?

Ethics of this
- taking repeat hamster wheel so called test fees by showing a carrot of funding!
- not disclosing what % they really fund
- Not being clear ( some of them) on what real account size one gets real or leveraged( read other peoples questions on similar threads)

If these tin pot props+ so called arms length Test taking company were serious about finding raw talent they would have taken a limited no of test candidates instead they give this BS about bringing trading to masses!
"Do you really think you are going to chart your way to billions at these bucket shops?
That exactly is my point these are bucket shops !
"They are broke and they have no education. I do feel for these people, don't get me wrong."
Great and I do too hence the pointed question
Infact more experienced people like you should be taking these so called props to the task instead you are piling on me like this!
genuine young or old people looking for a alternative get fooled by such offers if exp people like you concentrate on exposing such things instead of piling on somebody like me it will help those people more

"And btw, there is a cost to get into firms like Citadel. It's a 150k education from the University of Chicago "
Yes but that is a degree given by a reputable institute and can be used for other career's also , not a 3 room Educator come prop charging $200 a month or a GRQ bootcamp for $3000,
any way, I give up yes you are correct all this is great for the masses bravo

By the way Maverick, reg your comment about me getting or not getting in to a a university, for the clarity I already have Engineering education and have a career in that field my other passion is Fintech and Structured financial products and while searching on how all this works I got interested in such business models and weeding through all sort of scams/ semi scams and legits I found this new model and started thinking!
My genuine interest is to find if there is a middle ground model of not charging people fees and still doing it with min admin cost
SO on that account if you have some ideas please do share
First loss funding at retail does not seems attractive to people
Any other?
More...
 
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That post was really hard to read. In the future, use the bold font to separate the questions and the responses.

Let me just respond to this last quote of yours which gets back to your first post on this thread:

"My genuine interest is to find if there is a middle ground model of not charging people fees and still doing it with min admin cost. SO on that account if you have some ideas please do share. First loss funding at retail does not seems attractive to people"

OK, let me be very clear about this as you and honestly, many people on ET, seem to believe in this mythical unicorn called the middle ground. Trading is very much like professional sports. In that there are winners and losers and there is NO middle ground. You either win or you don't. There are lots of professions out there that have middle grounds, for example, accounting. I could be a CFO for a fortune 500 company or I could run a small mom and pop accounting practice in a small Oregon town. There are lots of jobs where you can half ass it. There are lots of jobs out there where you don't have to marry your work. Many people leave NY and CA and move to the middle of the country and seek out that quieter life.

With trading, that does not exist. Very few people make money or even have the ability to make money. The same with sports. Let's use a different example from trading. I use to play tennis in High School. I was decent, not great. I actually got a lot better after high school and played in some competitive leagues. I would still ascertain my talent as mediocre even at my best. Suppose someone came along and told me, I could sign up for his accelerated tennis training program that would allow me, in my 40's, to play professionally. BTW, the avg male pro is in his mid 20's. Now this pro assures me, I won't be good enough to win the US Open or Wimbledon, as he laughs, but he says he can get me to the "middle ground". I laugh, what is that I ask. You know, travel the world, play in tournaments, collect a nice middle of the road income, say 250k after travel and coaching expenses. He re-assures me just to be clear, I won't be a top player, that would be silly. But I'll be good.

This is of course absurd, first of all, while the top tennis players in the world, as in the top 10 males, earn probably 2 to 10 million a year, the median is 47k. But that median player is absurdly talented. There are probably 1000 men on the pro tour and maybe 10 to 15 of them earn a great income. The median 47k doesn't even cover travel and coaching costs. There is no "middle" on the pro tennis tour. It's either you are disgustingly talented, as in you started winning junior tournaments when you were 7 and have had pro coaching your entire childhood and can hit a 120 mph serve with your eyes closed, or you make nothing.

And the same is true in trading. Despite what all the premium sellers will tell you, the intraday scalpers, the DOM readers, the price action aficionados, the shot callers, the top pickers, the FX slayers, etc. And there is one tried and true path to that level which has worked for the last 100 or so years. And that is the path I previously mentioned. Are there outliers? Sure. There are those who enter this game at the exact right time and place and ride a bubble to riches and perhaps their talent catches up to their profits so that they can hold on to it. No question. But there is no way for you to take guys with no edge, no skills, no capital, and quite honestly, no real desire and find a middle ground where they can sit on a beach, maybe trade on mondays and wednesdays, if they so choose, and pull out some middle of the ground profits, say 100k. Oh sure, some guys on here will tout their "investing returns" as a rebuttal but they are just that, investing returns on their 600k IRA.

I have nothing to sell here and I have no reason to mislead you. I'm giving you my honest opinion. I have worked with thousands of traders. I've seen the numbers. If you want middle of the road, stick with engineering. It's actually the epitome of middle of the road. And I mean that in a good way.
 
Especially if you have an engineering degree (me too) or have stronger cognitive function - my guess is that you are going to be gravely disappointing with whatever you get for $50 or $200 per month.
 
Maverick74 said:
T

Sorry Mav but your long winded repose still does not answer the basic question of Ethics of such a business model!
To me it is nothing but generating revenue by test fees day in day out in thousands and fund very few if any
Legal? yes, Ethical NO
Lets agree to disagree
More...
 

Maybe get a CFA and become a financial analyst - or better yet, put your engineering degree to good use in the public or private sector.

You seem to require a certain social or moral construct to the world. You're predisposed on this tangent of good versus evil. You're hearing but you're not receiving.

Good traders are predators pure and simple. I don't picture you as that high up on the food chain.
 
[QUOTE="bone, post: 4704776, member: 10535" I don't picture you as that high up on the food chain.[/QUOTE]
Wow Bone.. another unnecessary personal attack ! By same token I can say people like you are "predators selling education which may or may not be worth it"
but keeping this slinging match aside

Yes, Bone as you say "Good traders are predators pure and simple" No questions there and market risk is market risk
My point is about "Predatory behavior of such business models, not the traders! don;t you get it?
I guess you won't because you are already on the dark side!

Any way... yes I agree there are suckers who are lazy and want a quick fix and yes, govt should not care about them, Further such wild west predatory business model should be encouraged to thrive including useless ICOs/ Questionable GRQ education sellers and the new breed of " Idiots of the world get funded easily " Education + Prop etc
Make America ( or whatever country one belongs to) great again
Amen
P.s for those who want to genuinely want to explore if a better more fair model can be constructed please respond, A retail level model where Firm gets the talent at very low cost of testing but does not sling wannabees with hamster wheel costs" and the true aim is to fund traders + risk manage capital of the firm, all at retail level !
 

Look, you keep moving the goal posts on this thread. You started this thread stating that "you" wanted to build a better model to fund traders. You then asked for ideas on how to do this. Then when we respond why it's a bad business model, you go into this long diatribe attacking the other models. This isn't about THEIR business model, it's about YOURS! Or am I totally out on left field here? You want to start this business correct? You started this thread asking for ideas correct? You stated you have an engineering degree and want to get into fintech correct? So myself and Bone are giving you all the reasons why this won't work. And then you go off on a tangent about the ethics of the very competitors you want to compete against. LOL. Should we have the mods kill this thread? Because you are taking your own thread off topic. The title of the thread you started here is:

Funding new traders Search for a better business model

 
There already is a pretty ideal prop trading model in the form of places like HRT/Tower or the multi manager hedge funds out there. Get a six figure salary, health benefits, effectively unlimited upside, and don't have to put up any capital. Also depending on the place can also invest with the strategy being run, granted might need to be a QP.

As Maverick74 said need to either have a top notch pedigree or what is also common and the way I got in was through being a programmer. Started on the tech side at an IB then joined a trading desk there (left after the volcker rule got put in place), and now run an equity quant book for a multi-manager hedge fund.

The other way is to have a strategy and find an appropriate head hunter who can shop it. But in that case you truly need to know what you're doing and surprisingly few people actually do..
 
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