Help: My Offer from a Prop Firm

Okay guys, check out my older postings about SketchTrade....MACDaddy did a good job linking to some good threads about the firm. ANyways youn7001, read what I wrote, and as a former prop trader there, I left because the firm was sketchy...

I ran into some ex colleaugues of mine at the gym yesterday. These guys would make 15k a month no problem back in July. Two of these guys were down for the month a couple grand. Thats how things are right now. Another couple of my friends there just quit the Toronto branch. Read about how they tried to make us sign shit. DONT sign anything.

Yes, it is true that if you make 4999 you get paid 0000. There are guys there right now that were making b4 tax 300,000 plus 2 years ago. Now some of these guys arent making their 5k before payout per month. Its a bad time to be there, these guys are scum, and no one is making money. Traders are dropping like flies, and as a result, they just interview more and more, and run them throught the system. Consider yourself warned.
 
One more thing....the Training at ST is shit and not worth even yhour time. It consists of the first 5 days, just learning about ECNs and terminology and stuff. After this, 'training' is just sitting there, fucking around with 100 share lots, as the trainer pretends to pay attention while trading themselves. Very little is actually taught during training. Mainly a term to describe the period when you arent getting paid.
 
Originally posted by youn7001

can anyone tell me roughly what dollar amount pass through's add up to in a month, assuming: 400 trades per day * 5000 shares per trade * 21 days = 42mm shares per month (these assumptions are what the ST HR-guy told me).
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First of all, that's WAY too much trading! You'll probably owe $100K+ in expenses by the end of the month. Dividing those trading amounts by ten is more reasonable (40 trades per day, 500 shares per trade). You don't need to write millions of tickets to be successful. The goal is to make money for yourself, NOT only the prop firm!

Pass thru costs differ from firm to firm, you'll have to talk to traders over there. I'd estimate that for every 1000 shares traded on Nasdaq, you'll pay anywhere from $4-6 in straight pass thrus. Any more than that is robbery. I'm not sure what the costs are for listed stocks but I presume they're similar.
 
Originally posted by FMRPROPT
One more thing....the Training at ST is shit and not worth even hour time. It consists of the first 5 days, just learning about ECNs and terminology and stuff. After this, 'training' is just sitting there, fucking around with 100 share lots, as the trainer pretends to pay attention while trading themselves. Very little is actually taught during training. Mainly a term to describe the period when you arent getting paid.
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I think it always was hard to trade even in the good old days you had 70/80% of traders that lost all their money... But one thing is sure may people are not making money like in the old days but there some traders that still make plenty of money...

If one can make it today he will certainly make it when the situation will improve...

Definitely of you have this opportunity Go gor it. 5 months is nothing and even if the training is bad don't worry about it and work for yourself and improve your skills.. This will worth a lot in a few years if you can handle the learning curve...

Good luck
 
As the original poster, I learned a lot from this discussion. Namely;

1. I want to trade prop
2. I want to trade for a prop firm other than Swift Trade

Hopefully there will be some competing prop firms opening their doors in the Toronto area. Until then, I'll keep reading the boards, books, charts, and learning as much as I can about the market.

Thanks again!
 
Prop firms w/o 100% payouts can be compared to prop firms w/ 100% payouts by comparing your net payout between the 2 firms after commissions, etc. and including your cost of capital, technology, etc.

IMO it is better to trade w/ someone else's $$ if you are losing $$. If you ever start making $$ and think you can continue to, borrow what you need and jump ship.

If you are making $$ and you're trading w/ someone else's $$ you can probably equate what you're paying for capital to a super high interest rate.

For example, if you make 5g's and keep 30% then you just paid $3500 for one month's use of $25g's (= 170% annual interest).

Sounds like a sucky trade to me. OTOH, if you lose $5g's and walk away...
 
I decided against Swift Trade for a couple of reasons:

(1) Training appears to be weak. I spoke with the trainer during my interview, and asked him if he traded. His answer was 'no'. From what I learned on this board, it's critical to be trained by someone who actually trades, or else you risk learning a strategy that is dated, and inappropriate in current markets. Also, FMRPROPT, a former trader there, said that training is 'shit', and is just messing around with 100 share lots.

That's consistent with what the Swift Trade trainer told me - that during the training period you're allowed to trade 100 share lots and it's up to you to make a profit.

Therefore, I am hesitant to join a company that will not train properly. After all, isn't training everything for a newbie?


(2) Because of a business relationship with another financial company, Swift Trade gets a flat rate commission on all the shares the traders buy and sell. That's a great deal, as long as you're with Swift Trade. But as soon as you leave for another prop firm or go out on your own, you lose that advantage. Traders there get accostomed to only paying pass-thru's, and no ticket charges.

My concern is that the Swift Trade trading mentality focuses too much on high volume trades that would be impossible to duplicate at another firm, or in retail. Once you're there, you're stuck. That's my main reason for not wanting to join Swift Trade.


Cheers,
M.
 
Originally posted by kztd
Prop firms w/o 100% payouts can be compared to prop firms w/ 100% payouts by comparing your net payout between the 2 firms after commissions, etc. and including your cost of capital, technology, etc.

IMO it is better to trade w/ someone else's $$ if you are losing $$. If you ever start making $$ and think you can continue to, borrow what you need and jump ship.

If you are making $$ and you're trading w/ someone else's $$ you can probably equate what you're paying for capital to a super high interest rate.

For example, if you make 5g's and keep 30% then you just paid $3500 for one month's use of $25g's (= 170% annual interest).

Sounds like a sucky trade to me. OTOH, if you lose $5g's and walk away...
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You make a valid point.
 
IMO, it is not important if the trainer actively trades as long as he has alot of experience. An experienced trainer can bring you up the learning curve much faster than learning on your own. Just because he doesn't trade now doesn't mean that he doesn't know what a good buy is.

Afterwards, practice and trial and error will enable you to develop a style that suits your personality. You can trade in 500 share lots and make good money with listed stocks. I don't think a prop firm would force you to take 5000 share lots if that is not consistent with your personality and risk profile.

Personally, I think Swifttrade is a good deal. While you're waiting for another Toronto firm to open up, you could get several months of trading experience under your belt. Plus, all other prop firms require a $5K deposit (at least). Don't be so quick to throw away this opportunity just because another trader had a bad experience there.
 
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