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Prop Trading Firms - Note On Threatening Regulatory Developments
- Thread starter traderob
- Start date
Quote from listedguru:
So I guess we would all go down to 4:1 intraday buying power? That sucks...
-Guru
Of course not. The established prop firms will find a way to redefine their structure, if anything ends up happening at all. They've just been pushing the boundaries a bit too far in the recent past to get by without some response.
I've been told this will not affect JBO's.
Funny that today Bloomberg released a story, in their NOV mag issue, about $7B USD in black box muni bonds - where the US gov, taxpayers, and citizens get robbed by banks, insurance co's, and financial advisors and the SEC and NASD are cracking down on prop.
Quote from ang_99:
Wow, this sounds like a pretty big deal. I'm surprised Don hasn't responded to this. He must have some insider info on this news...
Ok, here goes. First off, Bob Green called my brother and I a few days ago to chat about these "developments". I like Mr. Green, heck I even gave him a testimonial on his book jacket, but when we spoke, my brother and I made it perfectly clear that Bright Trading, LLC. is not in the middle of any of this. We have the same feelings about many "prop" firms out there, much like when we spoke in front of the NASAA (not sure of the acronym, but the Securities Administrators association)...when we said that there should be some additional regulation about "daytrading" with retail firms....but we think this is still America and we think every citizen has the right to go into business.
We have kept an impeccable record, and don't need our traders' money to meet Reg T requirements or any other financial obligation, and we do our best to help those who want to become full time traders to learn and perfect their craft, to hopefully excel in their chosen endeavor. (Enough soap box).
We are fine, and have actually gotten "extra" calls from outside traders the last few days (always happy to help and bring them on board), and for the foreseeable future, everything seems fine.
And, once again, I think that Maverick and I are on the same page here.
Hybrid kicks in on Friday, check out the NYSE website for instructional webinars, tomorrow and next week.
All the best,
Don
edit and PS I said what I could about a year or so ago about FASB150 rule changes that would eventually affect many "prop" firms (basically, being unable to "use" their trader's money for capital requirements), thus limiting their traders to, sometimes, worse than retail margins. Do a search about FASB150 ...not that it is the"only" thing happening, but probably a big part of it.
As always, I'll share what I can.
There will always be a place for proprietary traders who can consistently make money. I for one am glad this capital deposit (skin, token money...) could be eliminated because it will raise the standards in the boutique trading business and force firms to hire real talent and not just fill those arcade seats, collect their commissions, fees and profit splits and dump ALL the risk on the trader.