So. Cal. Prop Firms

Quote from trade4succes:

don, you forget that at your firm the really active traders pay through the nose for commissions, while on some true prop firms the commissions are truly at cost, and therefore nihil. would you rather have 50% of 100k without commissions, or 100% of 100k and paying 70k on commissions?
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There is no such thing as "nil" - all firms pay commissiona and have huge overhead, which is all applied to the "prop" traders - and check the above post for what happens to the traders that make money.

Since half our traders have been with us for more than 5 or 6 year, and many have come from the other type firms, I would venture that they understand the variables involved.

Again, to each his own,

Don
 
Quote from Don Bright:

If anyone believes the "zero" prop guys are giving anything away free, then I have some land if Florida for you. We have dozens that came from places like Schonfeld and are quite happy keeping all their profits. The "zero" prop firms do, in fact, allocate overhead and commissions to the traders, many are much higher than you might expect. They also have weird payout arrangements like 1/4 now, and another half in a year or two, whatever.

Our model is exactly like what Bob and I enjoyed on the Trading floors with SLK (Goldman) over the decades.

Now think about this for a minute. If you happen to be successful with "zero" down, within a few months you r account "should" have your money in it, right? Then if you lose that, it's your money that is being lost, right? But when you take money out, you split the cash with the Firm. Independent traders figure that out, and that's why they prefer to be independent.

All the best, and if you can find one of the very rare "good" deals, please forward a copy of your contract, I would like to see it. The contracts that I have reviewed in the past were pretty restrictive. I'm not saying that there aren't any "good guys" still out there, I would just like to know who.

All the best,

Don
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I have to agree with this.

Most full prop firms lock up a good portion of your p&l till at least the end of the year where they pay it out as a bonus. If you lose the money, then it's gone.

So basically, it looks like this. If you come into a full prop deal and you lose money, you are going to be gone pretty quick. The average is usually 2 to 3 months. If you make money and do well, then you are going to be pissed you are only getting 20% to 25% of your net p&l. I'm assuming you are on a 50/50 or 40/60 split where half of that is held till the end of the year.

So either way, you have capital at stake. When I was at Worldco, we didn't put up any money but they held 50% of your check until you funded a reserve account of 35k and you never got that money until you quit. So even though we didn't put up anything up front, we essentially all put up 35k on deposit.

Let me add one more important point here. I think we all can agree that trading is one of the more difficult endeavors one can ever take on in their life. And most good traders I know, took at least a year if not several years to become consistently profitable. Wouldn't you rather not have the pressure of becoming immediately profitable in 3 months or get fired. I think it's much easier for a trader to know that as long as they manage their OWN capital, they can stick around as long as it takes to become profitable. That my friends is called peace of mind.
That is something no full prop deal can ever provide.
 
Therefore if I am a trader at (BSC,GS,LEH a big Wall Street firm) were they let me trade millions of $ but only receive a % of my profits,; that I would (make more money/be more profitable) if I left big Wall Street firm and started trading Bright Trading's money, with Don letting me keep all the profits ?????? Of course with a SMALL commission amount taken out of my profits.

Now let me take a swing at the MAV :D.

Maybe in the old days they required trader to fund an account, today the trader does gets check end of month assuming the trader is profitable. Agreed being profitable easy to say difficult to produce.
 
These investment banking firms hire people to run the algo's not discretionary trading where the employee gets simply a percentage of their personal, discretionary profits. (Maybe a small fraction left over from the old days).

If you get hired by Goldman, God Bless You, that puts you in the top 1/1000th of one percent who apply (my guess anyway, LOL). A great firm, thousands of employees, not at all similar to WorldCo, Schoney, RBC, etc.

Different thing altogether, IMO.

(Your turn Mav, LOL).

Don
 
Quote from timcar:



Now let me take a swing at the MAV :D.

Maybe in the old days they required trader to fund an account, today the trader does gets check end of month assuming the trader is profitable. Agreed being profitable easy to say difficult to produce.
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No, you did not read what I said. In the old days you did NOT have to fund your account. No up front capital. They just kept 50% of your check and put that money into a reserve account. You still got a check every two weeks if you made money. What I am saying is, what's the difference. Either you fund it now or fund it later. Either way, your capital IS on the line!
 
Quote from Don Bright:

These investment banking firms hire people to run the algo's not discretionary trading where the employee gets simply a percentage of their personal, discretionary profits. (Maybe a small fraction left over from the old days).

If you get hired by Goldman, God Bless You, that puts you in the top 1/1000th of one percent who apply (my guess anyway, LOL). A great firm, thousands of employees, not at all similar to WorldCo, Schoney, RBC, etc.

Different thing altogether, IMO.

(Your turn Mav, LOL).

Don
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Agree. Goldman doesn't hire prop traders, they hire quants.
 
The "YoungOne" made a funny, apparently he did not understand that Mr. Don Bright thought the question was: name the "BEST" prop firm in So. Cal.

With huge leverage and better benefits at Bright Trading, hey why go anywhere else.
 
Quote from Mom0/pH0x:

the two are not mutually exclusive, one can be a quant and a prop trader, goldman does have a prop desk which is staffed with quants... they also have a fundy prop desk...
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I didn't say the quants are not prop traders. I said they don't hire prop traders. They hire quants to trade prop. In other words, they don't hire guys from ET. They don't hire shot takers. They are not looking for guys with TA skills. They are looking for quants! I think it's comical how people on ET think they have a choice between Goldman and Bright Trading. Love the humor around here.
 
Quote from Maverick74:

I didn't say the quants are not prop traders. I said they don't hire prop traders. They hire quants to trade prop. In other words, they don't hire guys from ET. They don't hire shot takers. They are not looking for guys with TA skills. They are looking for quants! I think it's comical how people on ET think they have a choice between Goldman and Bright Trading. Love the humor around here.
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prop trading is, very simply, taking positions in the market using someone else's money. usually a bank's. goldman hires prop traders. they employ prop traders.

many banks, even very small ones, have prop trading. frequently, the prop trades are an activity done on the side, with the trader's primary responsibility being fulfilling customer orders or squaring the bank's position.

i would hazard a guess that the vast majority of real prop trading is done in rates, credit, and fx, and not equities.

putting up money to day-trade is not prop trading. period.
 
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