Starting a fund / raising capital

[doublet83]

Quote from gmst:

yes if you are stocks only CTA is not for you. Sorry for the confusion.

But if you do stocks only, why not go the usual route of a prop stock trading firm. No investor hassles, at least 1:15 leverage on your capital. You will start making at least 5x what you are making now from day 1. Sounds a like a no-brainer deal to me. Where is the confusion here? Why even worry about raising money for next year or two, if you can just go this way and instead of making say 400k for the year make 2m for the year?

I have addressed this point before. I don't need any more leverage than I have now. Joining a prop trading firm is of no use to me. What I do is also more akin to portfoilo management than trading.

 

[gmst]

Quote from doublet83:

I have addressed this point before. I don't need any more leverage than I have now. Joining a prop trading firm is of no use to me. What I do is also more akin to portfoilo management than trading.

Given your numbers, you are highly underleveraged!

You mentioned 5.8% monthly Max DD with. 500k of PL. If you increase the leverage by 4, you will have 25% Max DD and generate PL of 2m. 25% DD is something that most people can easily digest and live with, this is especially more true when it is your own strategy/account.

Going at this rate in 2 yrs, you will have more than 5M of your own capital - and then you can start your own fund with your own money. SAC got started with 25M, so 5M is nothing to sneeze at. Its a very respectable sum. Newedge will sign you and they will also help you market your fund.

 

[Busta21]

Quote from gmst:

yes if you are stocks only CTA is not for you. Sorry for the confusion.

But if you do stocks only, why not go the usual route of a prop stock trading firm. No investor hassles, at least 1:15 leverage on your capital. You will start making at least 5x what you are making now from day 1. Sounds a like a no-brainer deal to me. Where is the confusion here? Why even worry about raising money for next year or two, if you can just go this way and instead of making say 400k for the year make 2m for the year?

Prop? Why would he do that for what the 1:15 intra-day?

 

[tradewiz50]

Quote from doublet83:

If you make it worth my time I can prove to you that these results are real. We can say, bet 5k on whether these returns are real or not, and transfer these funds to a reputable third party escrow service who will then verify my account statements, and transfer both deposits back to me.

You will most likely not agree to such a thing and continue to pollute my thread and others with your rambling.

Spoken like a true gambler.

 

[Busta21]

Quote from Busta21:

Prop? Why would he do that for what the 1:15 intra-day? If that was overnight margin then maybe but that intra-day equities game is a joke.

 

[Busta21]

Quote from tradewiz50:

Spoken like a true gambler.

lol - this thread is garbage. Just read that. Are you serious man? Why in the world are you wasting your time on here? How hard is it really to find someone to back you with that kind of return?

 

[gmst]

Quote from Busta21:

Prop? Why would he do that for what the 1:15 intra-day?

not intraday but overnight. Bright and few others will give you overnight leverage. He said he doesn't consider himself as a trader, rather as a portfolio manager (which I assume means that his holding period is days to weeks).

I don't know if he will get 1:15 overnight, even if he gets 1:10 overnight, thats 2-3x times his current PL depending upon what kind of Portfolio margin he is getting now. I don't see whats the confusion here. Its pretty straight logic, right? Unless if I am missing something obvious.

 

[Busta21]

Quote from gmst:

not intraday but overnight. Bright and few others will give you overnight leverage. He said he doesn't consider himself as a trader, rather as a portfolio manager (which I assume means that his holding period is days to weeks).

I don't know if he will get 1:15 overnight, even if he gets 1:10 overnight, thats 2-3x times his current PL depending upon what kind of Portfolio margin he is getting now. I don't see whats the confusion here. Its pretty straight logic, right? Unless if I am missing something obvious.

Seems straight-forward to me. Only way it's worth your time to put money at a prop is if they can get you leverage overnight, personal opinion.

 

[doublet83]

Quote from gmst:

Given your numbers, you are highly underleveraged!

You mentioned 5.8% monthly Max DD with. 500k of PL. If you increase the leverage by 4, you will have 25% Max DD and generate PL of 2m. 25% DD is something that most people can easily digest and live with, this is especially more true when it is your own strategy/account.

Going at this rate in 2 yrs, you will have more than 5M of your own capital - and then you can start your own fund with your own money. SAC got started with 25M, so 5M is nothing to sneeze at. Its a very respectable sum. Newedge will sign you and they will also help you market your fund.

I did say peak to through draw down was 8 to 10%, I think that's a good sized draw down that I wouldn't necessarily characterize as too low.

In my long term strategy I do not use leverage for the most part. I use leverage opportunistically when I feel like a short term trade is to be made. Even then I do not get anywhere close to the 7x portfoilo margin I already have access to via IB. However, my % returns are so high because I've aggressively taken advantage of these short term opportunities. It is almost impossible to get these % returns with long term buy and hold.

 

[doublet83]

Quote from Busta21:

lol - this thread is garbage. Just read that. Are you serious man? Why in the world are you wasting your time on here? How hard is it really to find someone to back you with that kind of return?

Hey, its not useless. The time commitment is relatively low and there is some chance of getting some useful information. Given how little I know about asset raising, the chances of me learning something is high. When I do really try to raise money or start asking around how to go about it, I'd like to at least have some basic knowledge so I know how to ask the right questions.