Just curious about the prop firm arrangement ... if you daytrade I can understand about being physically present in their office to trade. But if you trade on a higher time frame, like swing trading over days or weeks like I understand your clients do, then why is it essential to be in their office? Wouldn't a remote setup be appropriate in this case?
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Prop futures deals are very much different than equity prop deals in terms of structure and who's capital is at risk.
Since 100% of a prop futures firm's capital is at risk, and by exchange rules the trader is an employee of the firm and that trader's own personal capital is NOT at risk - I personally know of no registered prop futures firm that will let a new employee trade remotely. In fact, that arrangement is specified by the CME electronic trading firm registration bylaws.
Having said that, if you are NEW to a firm, regardless of your background, you must show up like an employee and prove yourself just like all the other traders. I do know of proven traders with long standing relationships at futures prop firms who do in fact trade remotely.
Common sense prevails. Put yourself in the position of a firm principal with a substantial capital investment at stake where the trader has essentially no downside from a capital risk perspective less any positive equity maintained through the course of a payout schedule. Also, the trader is being paid a draw salary, which typically will usually ( but not always ) be net negative for some period of time.
The only reason to trade prop futures is to first prove your mettle to the firm's principals, and then trade ridiculous stupidly big size. If you show consistency, the firm with lever the living piss out of you.
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If you've been a client of mine, ( and the firm clearly knows we are swing trading ), then by all means please ask that question when they fly you in and expense your hotel, meals, and taxi during the interview process.
That is one of a couple make-or-break questions that I would address in a pre-interview phone conversation.
With futures margins and spread margins already so low, it seems odd to go prop with futures. It makes more sense for equity trading with huge RegT margins. The value proposition (for both trader and firm) might be if they hire enough traders who show potential, perhaps a couple of them will be superstars.
That is an excellent question. If you're not day trading and pounding out a bunch of trades per day what would the prop firm expect you to be doing all day? Seriously - would they be OK if you went to the local Starbucks and read a book? Would they be OK if you just chatted with the other traders? Am not being a smart ass but it seems that swing trading is somewhat at odds with what is done day after day at a prop shop. Certainly their goal is to make big $ and if you can help them do that then I'm sure they could accommodate you. Bone, in your experience, how have you seen this situation handled?
There are a few bigger, more prominent privately capitalized prop firms that will accommodate strategies other than day trading and HF trading strategies. If you can define your risk, and have a track record, then the firm principals are fine as long as you act professional and don't bug the other traders and make a nuisance of yourself. I've seen this first hand at Ronin and Peak Six. They don't necessarily want all their traders doing the same type of thing.
If you have access to a Bloomberg terminal and the market research provided by firm, there are plenty of market-related items to peruse over the course of a day even if you are not actively working an order. Buy a copy of MatLab or Statistica or S-Plus and learn how to code it and feed Bloomberg T&S data into it. Learn how to do something that you don't already know. There are lots of ways to look professional and keep yourself occupied without acting like a misplaced frat boy.
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