prop firm/trading group?

Quote from bigpapi:

I've been there before after putting 5 grand together and reading a couple of books your finger gets itchy. It's perfectly fine to use the 5 grand to learn, rather than risking 25k on your first time around, but just don't expect prop firms to be bowing down to you, 5k is considered the bare minimum so do expect the used car salesmen to make you offers you can't refuse, that's what makes it even more difficult starting out not only are you getting into a deceptively easy career where as soon as you get careless your ass is grass, but you're also fighting off snake oil salemen that know your weak spots and are just waitting like hungry sharks to capitalize on it.
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This is very true. OP, some things to mull over: Most firms will have (and enforce) a one-year lockup. Lockups are a good thing - they protect you. They are intended to protect the firm from massive withdrawals leaving them undercapitalized and potentially blowing out. One year gives them time to plan, raise new funds, etc. if they receive a large withdrawal request.

That said, most of the contract language only applies the lockup to the first/initial deposit. If you have more than $5k I would still go in with $5k and then see how you like the firm. If you like it you can always put more money in your account but if you don't like it you can't take all $25k out and walk. Also, because you want to put down such a small amount, many firms would want you in their offices at the beginning before giving you $100k BP and letting you trade remote. Posting your location and experience would help people to reply to you.

As for training: Trading for $0 for 6-months (while letting your fees & ECNs chip away at that $5k deposit) is excellent training. Plan on it taking a solid month to get used to the software & execution platform.
 
I see where you're coming from but you are doomed to fail if (and unless you have a 500k to a million put away starting out) you have 100k of your money at risk, it's just too much pressure for a rookie ... you are assuming that the more you have to lose the better the chances of succeeding, that is not particularly true, unless you learn what you need to learn you will blow a 25k account just as fast as you will blow a 7 digit account. It takes years to learn what you need to learn, so why go through a couple of 100k accounts when you can learn just as well with a 5k account.


Quote from RedEyeFly:

Also, and I don't mean to be a boob, but I think it's reasonable to spend 25K in losses on your trading education, and if someone told me they spend 100K, that would not a major surprise.
It's a business, and if you need to sink 100K to get it going, fine, that's probably a hell of a lot better than starting a restaurant, insurance office, or whatever entry level firm you can think of.
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I agree, and am not doubting your idea. I just know that nothing is so real as having real money on the line, and consequently getting real experience. Some personalities are able to make believe with their paper money accounts, for me that was a chore - but so is the expense of learning... ;D Good Luck, I hope you guys the best!
 
man i wish i would of noticed all the responses finally starting to come in. some good information guys. The things that i asked seemed to be the things other traders have recommended asking. One person i talked to said a true prop firm doesn't require any money up front. But from what you guys are saying its pretty standard to post 20 - 25k.
some info about me -
been trading everyday for about 9 months (rarely day trading)
i had some pretty big gains (relatively) an some pretty big losses and nearly wiped out my small 12k retail account, took until about 3 months ago to finally get back up to even. Its up to 16k now and I am finally able to feel comfortable about the small daily gains i can take most of the time. You could say why dont you just wait till you get up to 25k and start day trading then. The reason im showing interest in a prop is because the majority of my gains have been made from the day trades i have done, and with an account less then 25k you can only make 3 round trips in a 5 business day period. You could say my gains are not that much, totaling barely 4k over the last 9 months, however I see my gains starting at 3700 which is what i got my account down to in the first 2 1/2 months. It took a little stupid luck at first an then allot of work to get it build back up, it seems the longer I have been trading it the smaller my gains are I think just due to being allot more aware of risks.
This is also why im apprehensive about putting a full 20k in with a prop firm before getting a chance to work from an account that i deposit a smaller amount with and see how comfortable i am with them.
- maybe i should of posted this info at the beginning.
 
Sounds like you're marching through a standard progressive learning process. If i were hiring traders to use my capital I would look for three things:

1) Consistency of returns

2) Size of max drawdowns in relation to typical returns, how does this statically reflect my capital placed in relation to overall market risk.

3) Capacity to trade with changing market conditions. For example, how did the trader adjust to the increase in and then lowering in speed and magnitude through the 2008 market sell off?

Lastly, I would actually be interested in the process by which the person trained themselves. I would look for a strong methodology of empirical improvement and then be able to identify how they would react to new learning.

I've thought about taking on some partners before, but then I remembered why I trade - because I like trading.
 
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