Prop Firms with 100% Payout

None. If you're talking about the registered b/d's that require a Series 56 license, they can't give you 100%, as they can't have "customers" only "members" which are part of the LLC. However you can get close to 100% depending on the firm and how you negotiate the terms of the contract.

Of course, your option is always retail, in which case you are a "customer" and where you keep 100%.
 
ScalperJoe said:
None. If you're talking about the registered b/d's that require a Series 56 license, they can't give you 100%, as they can't have "customers" only "members" which are part of the LLC. However you can get close to 100% depending on the firm and how you negotiate the terms of the contract.

Of course, your option is always retail, in which case you are a "customer" and where you keep 100%.
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How close to the 100% can you get and still get a good rate on your commissions.
 
robbo said:
How close to the 100% can you get and still get a good rate on your commissions.
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Like I said, depends on how you negotiate. There's been a lot of consolidation in the industry, so there is less competition than before, and rates can change anytime.

90% is ok if the commissions are dirt cheap (around 20-50 cents per 1,000 plus/minus ECN rebates).
95% to 99% is much better, but you'll pay around $2 to $3 per 1,000 (plus/minus ECN rebates).

Remember there are fixed costs (data/platform) and variable costs (commissions, ECN fees, etc.)

If you're constantly taking liquidity (buying at the offer, selling at the bid), then a rule of thumb is to add around .002/share to .003/share to whatever rate you're quoted, as that will be the "true" rate you'll end up paying.

If you learn about the various routes and exchanges that allow you to add liquidity, then the opposite is true, and you can really offset your commissions over time (you'll pay some SEC/TAF fees, which are minor).
 
ScalperJoe said:
Like I said, depends on how you negotiate. There's been a lot of consolidation in the industry, so there is less competition than before, and rates can change anytime.

90% is ok if the commissions are dirt cheap (around 20-50 cents per 1,000 plus/minus ECN rebates).
95% to 99% is much better, but you'll pay around $2 to $3 per 1,000 (plus/minus ECN rebates).

Remember there are fixed costs (data/platform) and variable costs (commissions, ECN fees, etc.)

If you're constantly taking liquidity (buying at the offer, selling at the bid), then a rule of thumb is to add around .002/share to .003/share to whatever rate you're quoted, as that will be the "true" rate you'll end up paying.

If you learn about the various routes and exchanges that allow you to add liquidity, then the opposite is true, and you can really offset your commissions over time (you'll pay some SEC/TAF fees, which are minor).
More...

If those rates are typical, it's no wonder these firms are closing down. Without a meaningful return from profits or trading, the doors close. I would think these days to get an above 80% payout and the rates you have above, 2 to 5 mils, the prop firm would have to expect massive volume. Even at 20 to 30 mils they must have the expectation of 500K to 1M shares/month.

1245
 
1245 said:
If those rates are typical, it's no wonder these firms are closing down. Without a meaningful return from profits or trading, the doors close. I would think these days to get an above 80% payout and the rates you have above, 2 to 5 mils, the prop firm would have to expect massive volume. Even at 20 to 30 mils they must have the expectation of 500K to 1M shares/month.

1245
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Agree. That's why they're closing down. It's not easy money as before and that's exactly why I have a prop account only for day trading and use IB for non-day trading. Otherwise, I'm usually on IB as you can make as much trading futures and FX as day trading, as long as you have the 20k.

For the firms that require 5K, it's not easy making money unless you're super conservative on your trades.
 
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