Prop Firm Proposal

[countercountertrend]

You do have a good point. Giving up 20% profits for substantially greater profits is not a bad trade if the new setup allows me significantly more capital and help me improve my trading skills. The big question is if that's possible.

As you pointed out, most of my most profitable trades have been swing trades. However, lately, I have been re-experimenting with daytrades with decent success(on a simulated account mine you).

Given that most prop firms specialize in intraday, the only way for it to work out for me is to just trade part-time prop. Does SMB cap and other prop firms allow that? For me it would be 6:30am-7:45am PST. I have a FT job that I pays me well and acts as a stabilizing and diversifying effect on my trading. And I plan to keep that for the foreseeable future.

I do some options tradings too though not much(again due to lack of capital). But I believe my swing entries and exits would be great points to enter in on options at those points.

Please let me know your thoughts on this.

Thanks!

trader99

P.S. http://proprietarytradingreview.com/SMB.html
Interesting. overall not bad reviews. But $250-$400 monthly desk fees(?). Wow. Right now, my commission is $0 at Robinhood. TC2000 costs me $29.95/month. IB data fees maybe another $20/ Albeit I don't get huge leverage now.

Typically if you get hired at a prop firm it is full time. If you wanna be a professional its a big commitment but it does pay off if you are able to progress into consistent profitability. Hard to get a spot as a trainee, but if you are net profitable over a decent period of time even if u trade part time, this helps a ton and separates u from the rest. If you want to apply as an experienced trader I dont think part time trading cuts it. IF its just equity you want, firms like topsteptrader will back you remotely (if you pass their combine, and its intraday only... so not really a fit for you). IF you are serious at trading I would recommend getting a spot at a proper prop firm though.

Quoting Mike Bellafiore clearing up some stuff on their selection process
http://traderfeed.blogspot.com.au/2009/01/jobs-with-proprietary-trading-firms.html
(comments section)

"There are three rounds of interviews that every trader must navigate before they are offered an invitation to trade with SMB Capital, our proprietary trading desk. Recent college graduates and traders with a consistently profitable day trading record, the vast majority of those who we recruit, do not pay for training and trade firm capital.

Some professionals, who are financially secure and looking to transition from another occupation into trading, are eligible to train with us. And for these individuals there is a fee for training. However, your chances of receiving such an invitation are one in one thousand resumes.

Recently, we created SMB Remote Training, which is separate from our prop desk. Those who wish to train with us but are either not offered an invitation to our prop desk, live outside NYC, or just want to train remotely can receive our training. There is a fee to participate in SMB Remote Training. We deliver our training via our website, SMB Training. All that we teach our NYC traders is offered to you.

My partner Steve interviews transitioning professionals. He does so after the Close and a full day of trading. It is possible that after 90 hour work weeks, 6 1/2 hours of grueling trading, and ten other pressing tasks on his mind that he once failed to mention our structure to an interviewee. If he did, then this was our mistake. There was candidate who made this claim and we profusely apologized.

As to receiving an invitation without sending a resume, without three rounds of interviews, this is not our policy.

SMB offers an excellent training program for new and developing traders. We have been in Trader Monthly. Some of our teaching techniques were highlighted on "Wall Street Warriors". We share market lessons and trading stories on SMB Blog. Today as I write we will be on CNBC's Fast Money. I understand that with exposure comes public comment. But for those who have never visited us, we do everything we can to help our traders succeed.

And for those considering day trading, please visit the excellent firms where you can start your career. We are one of them. After your due diligence, make up your own mind on what firm is the best fit for you. "

 

[trader99]

Typically if you get hired at a prop firm it is full time. If you wanna be a professional its a big commitment but it does pay off if you are able to progress into consistent profitability. Hard to get a spot as a trainee, but if you are net profitable over a decent period of time even if u trade part time, this helps a ton and separates u from the rest. If you want to apply as an experienced trader I dont think part time trading cuts it. IF its just equity you want, firms like topsteptrader will back you remotely (if you pass their combine, and its intraday only... so not really a fit for you). IF you are serious at trading I would recommend getting a spot at a proper prop firm though.

Quoting Mike Bellafiore clearing up some stuff on their selection process
http://traderfeed.blogspot.com.au/2009/01/jobs-with-proprietary-trading-firms.html
(comments section)

"There are three rounds of interviews that every trader must navigate before they are offered an invitation to trade with SMB Capital, our proprietary trading desk. Recent college graduates and traders with a consistently profitable day trading record, the vast majority of those who we recruit, do not pay for training and trade firm capital.

Some professionals, who are financially secure and looking to transition from another occupation into trading, are eligible to train with us. And for these individuals there is a fee for training. However, your chances of receiving such an invitation are one in one thousand resumes.

Recently, we created SMB Remote Training, which is separate from our prop desk. Those who wish to train with us but are either not offered an invitation to our prop desk, live outside NYC, or just want to train remotely can receive our training. There is a fee to participate in SMB Remote Training. We deliver our training via our website, SMB Training. All that we teach our NYC traders is offered to you.

My partner Steve interviews transitioning professionals. He does so after the Close and a full day of trading. It is possible that after 90 hour work weeks, 6 1/2 hours of grueling trading, and ten other pressing tasks on his mind that he once failed to mention our structure to an interviewee. If he did, then this was our mistake. There was candidate who made this claim and we profusely apologized.

As to receiving an invitation without sending a resume, without three rounds of interviews, this is not our policy.

SMB offers an excellent training program for new and developing traders. We have been in Trader Monthly. Some of our teaching techniques were highlighted on "Wall Street Warriors". We share market lessons and trading stories on SMB Blog. Today as I write we will be on CNBC's Fast Money. I understand that with exposure comes public comment. But for those who have never visited us, we do everything we can to help our traders succeed.

And for those considering day trading, please visit the excellent firms where you can start your career. We are one of them. After your due diligence, make up your own mind on what firm is the best fit for you. "

countercountertrend,

Thank you for your thoughtful and detailed response. As I've said before, I have DONE the prop shop route before back in 2001-2003. If I remember correctly, I was with ProTrader, Worldco, and EchoTrade. So, I know how that world works unless it has changed significantly since then(i'm not talking about commissions, etc. but structural).

As to resume and professional experience, I received my undergrad and masters at top 5 schools with many years of professional corporate experience interspersed with a few years when I tried out prop trading/daytrading.

I'm only revisiting this topic because of my recent success and I consider scaling my trading up. I have a decent sized PA for swing trading. If I move it to IB and get 4:1 intraday then I should be OK though NOT nearly unlimited capital as in pure prop setting.

I want to make sure if I were to try prop shop it has to be wroth the risk. My professional salary is way more than what I or anyone I know at the time made in daytrading. With zero risk and a lot of professional growth and career satisfaction.

I've read stories about SMB and other prop shops where they start newbies with 100 shares lot or less 5 shares. No that's not going to work.

My swinging trading is now much better than I ever made in my daytrading years. And my venture back into daytrading now is much better than it ever was.

Like Maverick said, it's not certain that prop trading is the best route for me currently unless there are some serious capital at play.

I'll give myself another 6months - 1 yr to see how it goes. Then I can figure other ways to get more capital. By then, my PA will hopefully pass into a very good place. And 4:1 will maybe enough...

trader99

 

[countercountertrend]

countercountertrend,

Thank you for your thoughtful and detailed response. As I've said before, I have DONE the prop shop route before back in 2001-2003. If I remember correctly, I was with ProTrader, Worldco, and EchoTrade. So, I know how that world works unless it has changed significantly since then(i'm not talking about commissions, etc. but structural).

As to resume and professional experience, I received my undergrad and masters at top 5 schools with many years of professional corporate experience interspersed with a few years when I tried out prop trading/daytrading.

I'm only revisiting this topic because of my recent success and I consider scaling my trading up. I have a decent sized PA for swing trading. If I move it to IB and get 4:1 intraday then I should be OK though NOT nearly unlimited capital as in pure prop setting.

I want to make sure if I were to try prop shop it has to be wroth the risk. My professional salary is way more than what I or anyone I know at the time made in daytrading. With zero risk and a lot of professional growth and career satisfaction.

I've read stories about SMB and other prop shops where they start newbies with 100 shares lot or less 5 shares. No that's not going to work.

My swinging trading is now much better than I ever made in my daytrading years. And my venture back into daytrading now is much better than it ever was.

Like Maverick said, it's not certain that prop trading is the best route for me currently unless there are some serious capital at play.

I'll give myself another 6months - 1 yr to see how it goes. Then I can figure other ways to get more capital. By then, my PA will hopefully pass into a very good place. And 4:1 will maybe enough...

trader99

My apologies, I wasn't aware of your background. I heard that the really good traders at SMB make 7 figures. Regardless of your choice, good luck.

 

[trader99]

My apologies, I wasn't aware of your background. I heard that the really good traders at SMB make 7 figures. Regardless of your choice, good luck.

No need to apologize. You've been very courtesy and polite and professional.

I feel, rightfully or not, that I could make 7 figures given the right environment. Called that overconfidence or what not.

But I don't want to make the leap from nice paying corporate world into no salary prop trading with a chance of making 7 figures. That's too risky. I've been there, done that back in 2001-2003 when I did that leap without any proof that I could make it in trading. And I was a total newbie to trading back then too.

Now much older and wiser, I want to PROVE to myself that will be a distinct possibility. To do that, I need to consistently make a few MULTIPLEs of my corporate salary for a few years. If I can do that, then 7 figures would be a natural extension and just a scale up.

Check back in a few years to see if I feel I'm at that stage in my trader's development...

Feeling you can do it and actually doing it are two different things. I like to be objective about something as risky as trading.

Thanks!

 

[trader99]

New Highs in my PA!! woohoo! Yet, the same problem. I wanted to buy more, but can't. Actually, I have some excess capital but I'm waiting for it to be settled (T+3). Damn Robinhood. hehe

 

[trader99]

countercountertrend, JesseJamesFinn et al:

Today was a really good day for my swing trading account.

Because I had to work from home a few hours in the morning, I daytrade on my test IB account. The results were lukewarm(slightly negative). This is so DISAPPOINTING. On a day like this, I should be really banking it!!! That tells me I'm NOT ready to dip back into daytrading either on my personal account or through intraday prop trading. Until I can consistently make $1K- $2K/day on average intraday on my test account, then I have no business daytrading or consider prop trading. It's all about risk/reward and time well spent.

In the meantime, I'll continue with what works. Continue with my successful swing trading and build up that account and on the side continue to test intraday trading until I get good and consistent.

I think the problems with daytrading for many people(or at least me) are the speed of things, decision fatigue, and profit potential. In swing trading, you study your charts, do your research, and you put on a trade. The moves are so much larger that you can wake up to multiple points moves easily. In daytrading, it's hard to make multiple points in one day. Of course, on high volatile days like today yes you can. But today I didn't either.

Then there's speed. In daytrading, you have to be constantly thinking and being in and out quickly. I'm not the gamer type. I'm more strategic though my swing trading of moving in and out in few days/week(s) would be consider super fast by traditional long-term investors.

Lastly, there's a component of decision fatigue. You go long then it reverse, then you gotta be fast then get out and reverse short. But you could be whipsawed several times. Psychologists call this constant decision making decision fatigue. For some people, they like that action. For me, I don't mind the action unless it translates into profitability.

Not that you can't be whipsawed in swing trading. Of course, you can.

Just sayin'

trader99

 

[trader99]

Another huge up day on my swing trading account.

Intraday test account:

Better today. But something is still off!!!

Short MRK: $205
Short DIS: $187
Short FOXA: $23
Short TWX: $7
==============
Total(after IB's comms): $422

Still can't break $1K/day on intraday trading. This is even on a test account. I was thinking I should have banked $2K-$3K on a day like this.

Better next time. Gotta get ready to go to work.

 

[syswizard]

Better today. But something is still off!!!
I was thinking I should have banked $2K-$3K on a day like this.

I don't think you have a system, so you are just gambling IMHO.
Plus, if you are shooting for $1,000+ per day, you should be trading at last 5,000 share lots.
What's your average number of shares ?

 

[trader99]

I don't think you have a system, so you are just gambling IMHO.
Plus, if you are shooting for $1,000+ per day, you should be trading at last 5,000 share lots.
What's your average number of shares ?

why do you think I"m gambling? I'm making consistent profits on my swing trading that are pretty sizable.

It's daytrading that's hard to master. Luckily, I'm only doing it on sim until I get profitable with intraday.

Today was another HUGE up day on my swing account. Swing trading is almost anti-daytrading. This week I almost did nothing. I'm running the upmove. Whereas in daytrading, one has to constantly trade and move and maneuver to generate profits. And that profits is a pittance(at least for me) than the profits I get from just getting up the morning and seeing my positions going further in my favor. This week has been good to me .

P.S. This will sound a bit silly, but I've located on major issues with my daytrading. It's time. I get up later than the open. Hey, I have a real job, a kid, and family. THis is something I do on teh side. Hard to get up on time PST. I think this itself contributes to the performance variances. Additionally, I have to get read to go to work(like now). So, even if I get up and am ready by 6:30am but leaving for work close to 7:50am or 8am leaves me like 1.5hrs. Perhaps, unrealistic to capture those bigs moves in 1.5hrs. haha.

 

[trader99]

This has been an AMAZING week for me! I hope I can keep this up! I'm beginning to realize if you are good at something just continue to stick to it and improve that. Why was I considering prop trading and daytrading when I had little to show for ? While on my swing trading PA, I'm making new highs almost everyday this week! And the target I set for myself for end of year, I'm already approaching it. Much faster than I had thought. These volatile times are the best for my strategies. I know there are cycles in volatilities. Bank it while I can!