Prop Job trading Futures or Equities

Quote from cartm:

I thought it was a pretty good article, I have the hard copy, tried to post a link but you have to purchase that particular article.......I think they quoted Don a bit in the article.....I do agree there were some questionable comments made.......if someone gets it post a link....................ty
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http://www.stocktrading.com/SFOarticle.htm

(Questionable comments?) Not mine I hope...LOL

Don
 
I was wondering if you could give an opinion on pros and cons of trading equities or futures...assuming Pay and commissions are the same (I know they won't be but to get to the point lets). Any info would be greatly appreciated.
 
Quote from Don Bright:



http://www.stocktrading.com/SFOarticle.htm

(Questionable comments?) Not mine I hope...LOL

Don
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don,

can you explain why a series 7 is needed. are you guys trading investor funds ? it has been my impression that a series 7 is not needed when trading private capital. can you explain this to me ? looking forward to dinner in NYC with some of your boys.

best,

surfer :)
 
Quote from Chitown:

I was wondering if you could give an opinion on pros and cons of trading equities or futures...assuming Pay and commissions are the same (I know they won't be but to get to the point lets). Any info would be greatly appreciated.
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Futures, in my opininion, are far superior to trade for the following reasons if assuming income the same either way.

- Better tax treatment.
- Immediate execution if trading any of the electronic markets
- No market makers or specialists
- No short sale rule
- All the leverage you would want

Jay
 
So if you had two offers to be a prop trader, one at a futures firm and one to trade equities, with a 28k draw at both, the futures firm looks like the way to go hands down. Oh yeah, no capital cont. at either one.
 
Quote from marketsurfer:




don,

can you explain why a series 7 is needed. are you guys trading investor funds ? it has been my impression that a series 7 is not needed when trading private capital. can you explain this to me ? looking forward to dinner in NYC with some of your boys.

best,

surfer :)
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Since 1998 it has been a requirement that all traders have a S7 license, or else they are simply "customers of a retail brokerage firm" (with all the inherent limitations, no capital usage, limited market access to the NYSE, DOT, etc.). The license really has little to do with trading, but allows us to trade as we did on the trading floor (without worries over "margin" "leverage" etc.), which is of Vital importance to trading.

We do have Bright Securities for those who are not licensed, or for hedge funds, etc., but we prefer that the serious traders go into BT as soon as they are licensed.

We can only allow S7 traders access the "capital needed" for trading ....no one can even do "opening only orders" without at least access to $1Mil or more...remember, this is "use of capital" not "abuse of capital."

See you all in NYC!!

BTW, the equities vs. Futures game....since we do both, and have for 20 years, I have to dispute the "tax advantages" (clearly better for our traders, futures or equities, vs. retail trading which is what was referenced above)...and the "zero sum game" factor is tough to beat....and when you can trade "with" the Specialist, you can see a quantifiable edge. I don't plan on "winning the argument" of derivatives vs. equities (but we did the derivatives when we had an edge, and we do the equities now about 50 to 1 vs. futures or options). When we provide the capital to trade, the lure of "leverage" is greatly discounted.

Don

Don
 
Quote from Jayford:



Futures, in my opininion, are far superior to trade for the following reasons if assuming income the same either way.

- Better tax treatment.
- Immediate execution if trading any of the electronic markets
- No market makers or specialists
- No short sale rule
- All the leverage you would want

Jay
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Major assumption "same income"......

Don
 
Quote from Don Bright:



Major assumption "same income"......

Don
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Don, I did not actually initiate the assumption same income, I was just answering the question as it was posted earlier.

I have actually worked at one of your offices, and thought it was great.

How can you possibly dispute the tax advantages of futures?

60% long term capital gains vs regular tax rates for equities..

Jay
 
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