Hi folks. So I know prop trading firms are very valuable for newer traders, because they offer training and mentoring, risk management and funding. What are some reasons an experienced trader would join a prop firm? Are they allowed to trade their own account there and keep all the profits, or do they have to trade a proprietary account and split profits?
Prop Trading Firms for Experienced Traders
- Thread starter countercountertrend
- Start date
The Prop business model is to make money on the training and other services....which experienced traders don't need. This is why you see non of them advertising for the "experienced" trader.
All those traders need is capital, and no, you are trading the company's money, not your own. Your money is just a deposit to safegaurd against a "blow-up". If you are profitable, you can get them to send you a check monthly. If not, you are SOL and can't get back your deposit for a year.
All those traders need is capital, and no, you are trading the company's money, not your own. Your money is just a deposit to safegaurd against a "blow-up". If you are profitable, you can get them to send you a check monthly. If not, you are SOL and can't get back your deposit for a year.
Actually pretty much every prop firm I know of will take on experienced traders and have a separate application for them. More so than new traders because experienced traders are a safer bet.
I really dont think there is a discrepancy between trainees and experienced traders. I think the demand for experienced traders is higher because again, proven track record. One well known firm, DE trading, actually has no current positions for trainees but they are open to experienced traders.
Some prop firms such as Chimera will accept trainees with no experience, but also take experienced traders who can provide their own capital.
Syswizard is correct, all traders join prop firms to get access to the firm's capital to trade with, at a much higher leverage than PDT rules of 4x intraday.
Syswizard is correct, all traders join prop firms to get access to the firm's capital to trade with, at a much higher leverage than PDT rules of 4x intraday.
Why the hell would a prop firm not take an experienced trader? Ive moved prop firms plenty of times. Show them you're profitable. Deposit an agreed capital level and you're away.
Successful trainees offer prop firms the best bang for their buck as they are on lower profit splits. But trainees that fail are pretty expensive. Taking on a senior trader that can put down 20k+ never risking the firms capital and give you a few grand or two a month in profits through commissions and profits splits is easy money for the prop firm.
Successful trainees offer prop firms the best bang for their buck as they are on lower profit splits. But trainees that fail are pretty expensive. Taking on a senior trader that can put down 20k+ never risking the firms capital and give you a few grand or two a month in profits through commissions and profits splits is easy money for the prop firm.
That was my point all along.
Prop firms want and need experienced traders ( successful goes without saying) who will do major volume ( create commissions) and are consistently profitable ( regular income from the splits). The only problem is most traders leave props once they have built their capital base and garnered enough experience. Having been at two props I can say your point is wrong without hesitation. Only exceptions I can see is if they are a roach house and their primary aim is to dip in a traders pocket and possibly deposit.