Prop trading after decimalization

R

rope777

Id like to correspond with anyone who can tell me about Proprietary trading in general and the proprietary program at All-Tech in particular.I have interviewed with several Daytrading firms in Manhattan,On-Site,Worldco and Bright Trading.My deal with All-tech is as follows,$2 R/T commissions up to 5,000 shares,no ticket charges or any other charges,no long term contract,after 90 days I can leave without penalty,50/50 payout initially and 60/40 after 60 days if profitable,.0002 rebate on trades using the ATTAIN ECN.As I would be considered an employee(W-2) of All-tech and not a self-employed trader(1099) I would also be eligible for medical,dental and 401K.I must put up $5,000 as my equity.Questions: 1)is this a good deal? 2)What do other firms offer? 3)What other questions should I be asking before I commit to this firm? 4)What are the true odds of making it as a daytrader in this age of decimalization?Can't I still make money scalping if my execution costs are only $2R/T? 5) Is there enough volatility in these markets to make money?

I just graduated and I would greatly appreciate input from anyone good or bad about this firm or prop trading in general.I am lost.......
 
Let's see:

>$2 R/T commissions up to 5,000 shares

Hold on just one second here, is that just the ticket cost or the entire commission? Are you sure you can buy 5000 shares for $1 and sell 5000 for $1? I know of no firm that does this for you. That is very very nice. Is that NYSE or Nasdaq? How about bullets? Do you get them and how much they cost?

>no long term contract, after 90 days I can leave without penalty

This is no big deal, not a real advantage as most firms don't care if you leave . . .

>50/50 payout initially and 60/40 after 60 days if profitable

This is the killer, can it ever be lifted to above 60%? Personally if $2 rounds trip commission plus a 70-80% payout I am switching firm :-)

>As I would be considered an employee(W-2) of All-tech and not a self-employed trader(1099) I would also be eligible for medical,dental and 401K.

Sounds good.

>I must put up $5,000 as my equity.

Can you get into firm capital? How deep?

>is this a good deal?

Yes, absolutely. Assuming you can go into firm capital without worry . . .

>What do other firms offer?

Much higher commissions (no flat fees, always measured in cents per share), but much higher payout, 90-100% . . .

>What other questions should I be asking before I commit to this firm?

See above

>What are the true odds of making it as a daytrader in this age of decimalization?

A wannabe trading out of his Datek / Quote Tracker account, near zero. Someone trading a 25K account with IB and good software, 10%. Someone trading out of a prop. firm without pressure on his own capital, and access to capital to trade big sizes, 30%. Someone trading out of a prop. firm AND really really really want it, 50%.

>Can't I still make money scalping if my execution costs are only $2R/T?

Yes, but buy the BID sell the ASK thing doesn't work that well anymore. There are scalpers with much higher commissions (1 cent per share) still making money, just have to tweak your strategy.

>Is there enough volatility in these markets to make money?

No one can foretell the future, but yes, right now, while most traders including myself are struggling, the best are still making very good money, tough market environment will always be here now and then, gotta combat it as a pro.

>I just graduated and I would greatly appreciate input from anyone good or bad about this firm or prop trading in general.I am lost.......

If you are into day trading, this is the ONLY way to go as a newbie.
 
That's competitive I'll admit. There are quite a few traders still making money trading in this market. Think of it this way there are 2 sides to each transaction.


I do want to ask Hitman's question
What are the cost of bullets??


I'm paying a .03 a share for mine.

I'd be interested in hearing how the other traders are doing there? What you don't want to be is involved in a trading room with a lot of negativity. If they grew the office slowly with successful traders teaching others and the majority of the office is profitable than you have a great situation.


The payout sounds pretty low. Highly profitable traders would more than likely want to switch to a firm with a much higher payout. I'm 100% payout but so are my losses.


I choose this because I don't wish to have someone take a % of my profits.


The office fee?

Software fee?



See part of this thread for other firms that are in competition.
http://www.elitetrader.com/vb/showthread.php?threadid=1608&pagenumber=3


What's All Tech's contact info? I'll add it to the other thread.

I'm with Echo for disclosure.
rtharp
 
Rtharp:

Personally if I am new I would choose the $2 round trip commission, he can get experience at this firm while actually getting paid! I think I would have got a check starting first pay period had I started with that! 90 days later, go find a firm with 90-100% payout if you are profitable. The 100% payout won't do me any good if I am losing money after commissions 1 out of 20 days.

I had an interview with Tradescape a while ago (rejected me because I had no degree), you pay no commissions, put up no capital, and you get 25% pay out but a $2000 salary, in my opinion this kind of firms are much better for someone to start off with . . . They are actually interested in YOU making money, instead of racking up commissions . . .
 
Thanks for the info guys,much appreciated.As far as I know the deal is from 1 to 5,000 shares the fee is $1 in and $1 out,no per share commission charges,this only applies to prop traders and not their retail customers.Reason given to me by the recruiter was that they dont make money on execution costs but rather on traders profits,perhaps this is the reason for the low payout?Will have to ask about bullets and the cost.Attain is actually the ECN and retail side of the firm,the subsidiary that handles Proprietary Trading is Domestic Securities.Both firms are owned by Harvey Houtkin.They can be reached at

http://www.attain.com
 
I agree with you. A profitable trader would want to have 100%. An unprofitable trader would want to have no losses but share a % of his winnings while learing.



Tells you though the kind of traders which will be at both firms. Surprised that they don't have handcuffs on their traders...........HOlding period on capital for one.

Bright has a year to my knowledge for 25% of capital (which they keep interest on)


I'm adding http://www.attain.com to other post
rtharp
 
Everything about this industry is repetative, and learning is through repetative experience as we progress through the time equation. Simply put, you can't expect to sit where the grown ups sit, unless your assets are as large and can cover the chair.

If your assets are as large as grown-ups, and can cover the chair that they sit in, then you should have already become used to the Trust Fund Baby syndrome. Otherwise, you should start small with your own personal account, through a regular brokerage service, and then progress through knowledge and familiarty with the procedures and process of the industry "as a customer". Over time, whether you make money or not driving your account around the block, you can decide whether you have the emotional and maturity discipline to stomach this industry.

Should you survive that course work, which takes years, months, weeks or even textbooks, then you can decide whether you will want to get licensed and proceed to the professional trader level. Don't mistake brains with the bull market, or hunger for thrills with trading.

You asked too many questions for this discussion board. Most of the replies barely covered even one of them. Hence that means that you are undecided with your life course. This is not the place to practice growing up in. I chose to answer question 4. Decimalization has posed a severe challange to all of us, and all of us are adapting. Our resistance to this change has been futile. We are all adapting. This discussion has continued to miff and baffle most of us. I participated in an open forum recently on this topic and no substantive answers were given. One solution was to adjust the level II displays to change level color on 6 cent intervals, thus undoing the decimalization effect. Another way to handle it was to think and position trades in 6 cent intervals thus not fighting the actual penny on every trading situation.

Now that I've answered your specific question what did that have to do with the price of Tea in China? You've got much bigger issues to resolve and grow into than worry about how to handle decimalization vs. professional trading.
 
hold on a second!
I also interviewed with All-tech, it was about six months ago so maybe things are different now but this is what they told me.

1) I had to put up $5000...just like you said, and any losses came out of that( what risk are they taking?)
2)cheap r/t's if you use ATTAIN, anyone see them up on Level 2 anymore? i hardley ever do...
3)they told me i had to take their training course and pay for it! what's that all about?

I acted like a professional and didn't walk out even though I wanted to...
I even had my series 7 already....

Things might be different now 'cause I know they pretty much cut the retail arm all together but...it just seemed like it was a way for them to get someone to pay for their Training then put up $ to cover any losses..and if that $5k was gone you have to put up more if you want to continue
anyway that was my experience at the NJ hq's, I forget the guys name but he was supposed to be head of trading and when I looked it up on NASDR.com he didn't even have a 55?
Not to knock them, I know Harvey has been somewhat of an inovator but , well thats my 2cents
 
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