Since you plan to actually meet the person you wish to work with and share ideas, be sure to request statements attesting to the performance alleged by your new friend. Even with the best of friends, the modus operandi should be to "trust but verify."
Looking to Sponsor Trader in PA
- Thread starter t-time
- Start date
Thunderdog, Surdo, Cutiger75:
All your comments are appreciated...I will be very careful to scrutinize everybody and everything. Also, please do not get hung up on the 10K number. It is hard to put a "number" on something when it is not an exact science - if I need to "invest" more for the right person, then I will address.
Thanks and Good Luck,
t-time
All your comments are appreciated...I will be very careful to scrutinize everybody and everything. Also, please do not get hung up on the 10K number. It is hard to put a "number" on something when it is not an exact science - if I need to "invest" more for the right person, then I will address.
Thanks and Good Luck,
t-time
Surely there are ways to have accounts set up where basically one can trade others monies and not need to be registered etc.
Also there are ways to set up accounts where only the person who is the owner of the funds can be the only one to draw a check and or close the account. That persons name is for that personal account, not co-mingled together.
I am looking into this sort of thing for next year as stated before, trading is a lonely business and a couple of focused others can help all concerned when on the same page.
The problem with many non-private chat, conference rooms is others in them want to talk about some silly indicator that to you is hocus-pocus, etc.
Now here is another thought of a private room, maybe one will make the trades as the others watch and learn. Kind of like a mentorship chat room.....
So the conditions of the money etc would be 100% controlled by its owner. Should be fun...
My thoughts on money was in area of 10k also, that would be a reasonable figure to trade the ES for the chat purposes for EACH account...Like with Velocity Futures and using X-Trader, the KING of platforms. Velocity might have different accounts for the main trader of said accounts.
Also there are ways to set up accounts where only the person who is the owner of the funds can be the only one to draw a check and or close the account. That persons name is for that personal account, not co-mingled together.
I am looking into this sort of thing for next year as stated before, trading is a lonely business and a couple of focused others can help all concerned when on the same page.
The problem with many non-private chat, conference rooms is others in them want to talk about some silly indicator that to you is hocus-pocus, etc.
Now here is another thought of a private room, maybe one will make the trades as the others watch and learn. Kind of like a mentorship chat room.....
So the conditions of the money etc would be 100% controlled by its owner. Should be fun...
My thoughts on money was in area of 10k also, that would be a reasonable figure to trade the ES for the chat purposes for EACH account...Like with Velocity Futures and using X-Trader, the KING of platforms. Velocity might have different accounts for the main trader of said accounts.
I am not in Philadelphia...but I wish you the best. MarketSurfer should be able to help. He seems like good people..
Michael B.
Michael B.
I went in and was watching the marines fight on the history channel and was subliminally thinking about trading someone elses money.
Check this out: Say a person sets up a chat room or a video conference (some accounts also might be traded for those who go to the salt mine for a normal day of grind so they will miss the chat), then the person puts up 10k as example, that money would go into that same persons account but the other person is trading the account (elimination the worry of theft). OK, so say there is an initial agreement of a 50/50 split for the first year for profits but the person doing the mentoring only gets to draw 30% of the 50% because the taxes will be paid by the account owner, .....Follow?
The issue of stealing is eliminated and the business of trading and helping/teaching another person can proceed.
Those that say another trader is not willing to help others are wrong. It is possible, surely the details can be discussed and worked out. I would not be comfortable trading anothers money on a split basis without knowing i first eliminated all possible avenues of theft. I make enough anyway...no need to go to jail...:eek: :eek: :eek:
Back to the marines...
Check this out: Say a person sets up a chat room or a video conference (some accounts also might be traded for those who go to the salt mine for a normal day of grind so they will miss the chat), then the person puts up 10k as example, that money would go into that same persons account but the other person is trading the account (elimination the worry of theft). OK, so say there is an initial agreement of a 50/50 split for the first year for profits but the person doing the mentoring only gets to draw 30% of the 50% because the taxes will be paid by the account owner, .....Follow?
The issue of stealing is eliminated and the business of trading and helping/teaching another person can proceed.
Those that say another trader is not willing to help others are wrong. It is possible, surely the details can be discussed and worked out. I would not be comfortable trading anothers money on a split basis without knowing i first eliminated all possible avenues of theft. I make enough anyway...no need to go to jail...:eek: :eek: :eek:
Back to the marines...
Read this and then print it out because you need to ensure that this mentor/student relationship you seek is suitable for you and I hope the potential mentor your looking for in PA will also read it...
It's a two way street and it explains why:
http://www.elitetrader.com/vb/showthread.php?s=&threadid=32793&perpage=1&pagenumber=7
The only difference is that this mentor will be trading with your money...
A trading account he/her has access to but unable to make any withdrawals/transfer nor address changes without your permission.
Trading accounts as such can be setup with brokers.
As for the amount of money...
That's the tricky part...the profit sharing whatever the percentage is...
Will need to exceed his/her current annual profit level or else he/she risk being in a losing money venture with you.
Example...lets say you find someone in PA making 90k per year for the past few years...
That profit sharing percentage will need to exceed 90k or he/she is a fool trading your money and making less.
I'm sure you've already figure out the trading account will need to be very large in comparison to the annual profit level of the trader your going to be essentially a venture capitalist with.
Start thinking in terms that your venture capital will need to be 10x his/her annual profit level...
Anything less should be unsuitable for the trader because to properly trade your account...he/she will need to stop trading their own account.
Whatever you do...don't merge your funds.
Now...there's been echoes already here in this thread and in the many other past threads like this...
Why would a profitable trader want to trade someone else money and not his/her own money ???
Here's why...there are some profitable traders still early in their careers...
Maybe they have debts and they aren't able to grow their own trading account as fast because their profits are being used to pay off those debts.
Maybe they've been consistently profitable trading 1-3 contracts and are preparing to 2x-10x the contract size but have run into a lot of fear about such...they may see you as a way to do such without risking their own money.
My point...there's different reasons out their and you better make sure either a lawyer is involved or you work/learn from this trader prior to him/her going near your venture capital...
To prevent being scammed.
Once again...the only way your going to get someone interested in your offer is if the percentage of the profit sharing greatly exceeds their current annual profit level.
Last of all, stay away from profitable paper traders or traders with a profitable method that's been backtested but never traded with real money...
You want someone that's a profitable trader with real money...where there was a real risk involved.
You may want to do a background check (private investigator) on this trader especially if your talking about a very very large trading account.
I didn't say a credit reference check...
I said a background check to uncover any past illegal activities.
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*** Prior to doing a background check...
You can get things started on your own if its an ET member that contacts you.
Review that ET member posting habits...read every single one of his/her past messages here at ET...
If they discussed trades taken here at ET or were posting trades here at ET...
These are trades they must show proof to you that such were taken with real money.
Simply, this is a character check and their ET posting history is an early indication to you about their character.
Further, while reading all their past posts here at ET or anywhere else...
You want to see if the trader was rude, disrespectful, unprofessional, poor communication skills, poor trade managment skills if they posted trades et cetera...
Your looking for anything that would merit not proceeding further with this trader (not going beyond a phone conversation).
Therefore, you can do a lot of elimination via this process alone.
(this eliminate ET guys like the skalpz or FXsKaLpEr characters)
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After all the above...wish you luck because the odds are high you either aren't going to find someone in PA that meets your criteria or those that contact you will either try to scam you or don't meet the qualifications or try to convince you the criteria is too rigid.
Last of all, anyone interested in getting involved with you...
They shouldn't do it unless this type of relationship begins with you trading in front of them prior to any mentoring and prior to them trading your account.
Simply, he/she needs to determine if your suitable for learning and will help keep some things in perspective when they begin trading your account...
As described in that link above...
It's a two-way street.
Get a lawyer involved, talk to your tax accountant, have paper work drawn up and signed...
Keep it simple, professional and clean.
Mark
(a.k.a. NihabaAshi) Japanese Candlestick term
It is a very simple process to set up. Most brokers will provide access to trade another's account, without withdrawal capabilities. This is how I trade for my customers. I had no desire to set up a formal hedge fund structure, so I simply had them deposit their funds in their name at my broker. I enter trades, get paid 20% of all profits, and everyone is happy. The only downside is that I must enter multiple orders, but that's a small price to pay for the overall simplicity of the operation. Once every couple weeks I e-mail an overall market summary, but no need to maintain account statements, as they can go online anytime and view their accounts.
The issue of whether or not one needs to be a registered "Investment Advisor" is tricky here. The general feeling from my research is that so long as things stay relatively small and informal, you are okay. However, it is important to operate through an LLC to protect your personal assets in case your plans go south. Don't ever trade for someone unless you are protected by the LLC.