Minimum for Prime Brokerage Acct?

Hello_Dollars · Nov 5, 2003

What's the prevailing minimum amount needed to open a prime brokerage account? I've heard anywhere from $500k to $3 mil. Also, any thoughts on best/worst prime brokers (i.e. Bear, GS, ABN, etc.) from anyone with direct experience with any PBs? Thanks.

HD

Maverick74 · Nov 5, 2003

Quote from Hello_Dollars:

What's the prevailing minimum amount needed to open a prime brokerage account? I've heard anywhere from $500k to $3 mil. Also, any thoughts on best/worst prime brokers (i.e. Bear, GS, ABN, etc.) from anyone with direct experience with any PBs? Thanks.

HD

I want to say 1.5 million is the minimum for most. I would look at Bear Stearns first.

i'mlong · Nov 5, 2003

SEC min is 500k. Most big brokers are well Over 1.5 mil.

Joetrader · Nov 5, 2003

SEC min is 500K. That means no one can legally offer you Prime services for less. Also, the way the law is worded, if your account were to ever drop below 500K (at the close) you would have to make up the difference or they would close out your account (instant margin call). To avoid this most brokers want at least 1M and the trend seems to be higher and higher lately. Most of the bigger houses want 5M min. Spear works with GS to offer a myriad of services all over the world. Domestically, their REDI + and Tradefactory products are excellent. Both can be fully automated, although tradefactory was designed specifically for automation of strategies. BTW - REDI + doesn't have any slowness problems when you have your own T-1 connection. I don't think it's the speed of the T-1 line itself, but the servers to which private lines are connected at SLK (seem to be less utilized).

MYDemaray · Nov 5, 2003

What type of fees do you see with SLK? Where are per share fees now in the prime broker biz?

metooxx · Nov 5, 2003

$5 million is more realistic...

Hello_Dollars · Nov 6, 2003

Thanks all for the helpful info.

HD

Diamond Geezer · Dec 4, 2003

I mean a Prime Broker type of environment (excluding prop shops)?

The minimum dollars mentioned here are prohibitive for me. Also I'm fearful that the recent SEC ruling on bullets may be the death knell for the prop shop business model (on top of other adverse conditions lately).

I need all the things a good prop shop provides WITHOUT the fear of the doors being closed. I have decent net worth but not those numbers.

Anybody?