cstfx,
Do you currently work, manage or own this keystone group?
While I completely agree with what you're saying about doing your research and not having to join a firm you don't like, I do have a problem with the fact that these particular set ups, NOT TALKING ABOUT KEYSTONE IN PARTICULAR, do not protect the trader. This is b/c unlike normally putting down a risk deposit, you don't have access to your money in the same way.
For example, when you first open your account with one of these non registered shops, you DO NOT have the ability to take out money whenever you want. Paydays are usually some point in the first two weeks of the following month. Also, when you first start your account, your balance will be ZERO not the 5K which you put in.
If you are gullable enough to believe that the training fee is not in fact your risk deposit then you are simply unaware of what's going on. The fact that an additional training fee (assuming that the people on this post are not lying about it) is implemented when drop below an amount of money less than or equal to your training fee should tell you what is really going on here. While I strongly disagree with the SEC's rules about needing a license to trade for yourself, I also disagree with firms go into the GREY AREA to escape what are for now the trading rules.
You are however once again right in the fact that you should do enough research before putting up money anywhere to know what the real dynamics of the firm are, b/c the rules don't allow them to be straight forward. For instance, it is my understanding that keystone is a sub under Hold Bros and there is nothing wrong with that, almost every shop setup in this particular manner is just a large subgroup. The only thing I do have a problem with is that traders may be unaware of what the rules are and might be putting themselves in a weird position without knowing it. You can argue that they should do their own research, I believe that a firm has an equal responsibility to disclose exactly how their setup works.
I'm sure that Keystone and most of the larger sub llc shops ARE INFACT SET UP IN A LEGAL MANNER and your money is more than likely to be safe. But there are many smaller shops out there where one trader's losses can cripple the overall firm and possibly wipe out some of your money, not purposely but at that point what difference does it make to you. I have seen start up firms get taken down by a trader being halted in a refco type deal where there is not chance to get out and the firm doesn't have sufficient funds to cover a huge loss, granted these were overnight positions but the other traders money was still gone and the firm declared bankruptcy leaving the traders not in the trade holding the bag.
All I'm saying is do your research. I have never worked with Keystone or any of the new llc shops, but I do understand that Keystone in particular limits traders downside in the beginning which prevents these types of events from crippling them. If you do infact go the sub route then those are the types of firms you should make sure you associate yourself with. There are a few good ones out there so just make sure that's where you're searching. It might not be as exciting but atleast you'll have a fighting chance.
Do you currently work, manage or own this keystone group?
While I completely agree with what you're saying about doing your research and not having to join a firm you don't like, I do have a problem with the fact that these particular set ups, NOT TALKING ABOUT KEYSTONE IN PARTICULAR, do not protect the trader. This is b/c unlike normally putting down a risk deposit, you don't have access to your money in the same way.
For example, when you first open your account with one of these non registered shops, you DO NOT have the ability to take out money whenever you want. Paydays are usually some point in the first two weeks of the following month. Also, when you first start your account, your balance will be ZERO not the 5K which you put in.
If you are gullable enough to believe that the training fee is not in fact your risk deposit then you are simply unaware of what's going on. The fact that an additional training fee (assuming that the people on this post are not lying about it) is implemented when drop below an amount of money less than or equal to your training fee should tell you what is really going on here. While I strongly disagree with the SEC's rules about needing a license to trade for yourself, I also disagree with firms go into the GREY AREA to escape what are for now the trading rules.
You are however once again right in the fact that you should do enough research before putting up money anywhere to know what the real dynamics of the firm are, b/c the rules don't allow them to be straight forward. For instance, it is my understanding that keystone is a sub under Hold Bros and there is nothing wrong with that, almost every shop setup in this particular manner is just a large subgroup. The only thing I do have a problem with is that traders may be unaware of what the rules are and might be putting themselves in a weird position without knowing it. You can argue that they should do their own research, I believe that a firm has an equal responsibility to disclose exactly how their setup works.
I'm sure that Keystone and most of the larger sub llc shops ARE INFACT SET UP IN A LEGAL MANNER and your money is more than likely to be safe. But there are many smaller shops out there where one trader's losses can cripple the overall firm and possibly wipe out some of your money, not purposely but at that point what difference does it make to you. I have seen start up firms get taken down by a trader being halted in a refco type deal where there is not chance to get out and the firm doesn't have sufficient funds to cover a huge loss, granted these were overnight positions but the other traders money was still gone and the firm declared bankruptcy leaving the traders not in the trade holding the bag.
All I'm saying is do your research. I have never worked with Keystone or any of the new llc shops, but I do understand that Keystone in particular limits traders downside in the beginning which prevents these types of events from crippling them. If you do infact go the sub route then those are the types of firms you should make sure you associate yourself with. There are a few good ones out there so just make sure that's where you're searching. It might not be as exciting but atleast you'll have a fighting chance.
