Starting/Working for a Hedge Fund

timcar.....for many, many, many years I tried getting hired on with a trading firm, even a prop shop, and I couldn't get a bite. I'm scratching my head over this because I sent resumes' to firms advertising in the local paper, saying you needed to put 5k in yourself, and nothing. I landed 1 interview with a futures firm who was going to start noobs on the 5 year note and I didn't get the job.

Nowadays, it seems you can hook up with a prop shop if you have a bank account and a pulse. So why couldn't I get hooked on? Dunno. It all worked out in the end because I think I would have washed out at the prop level anyway.

Quote from timcar:

It is interesting that giving the choices of best way to obtain more trading capital the three best would include:

1. go to PROP firm
2. borrow from financial institution
3. borrow from friends

The one you chose Profittakingfool was number 3.

Those three options are available to most traders as well. The "borrow from friends" one seems to me to be the most stressful b/c if you happen to fail having to live with these people rest of someones life can be difficult. Also the stress of knowing this is friends/family money could cause a trader to made trades he would not normally make.

Personally I would chose the "borrow from financial institution" being that if I failed and actually lost some of their money I would just have to find a job and pay them back. I don’t think the financial institution would even care who I was, they are just looking at me as another borrower and as long as they get their interest back they would not care if I was successful or not.
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Great thread PTF.

I'm guessing your's is a 3(c)1 fund?

I'm looking to hopefully open a fund in 13 years (I'm 17 now). I consider myself kinda lucky though, because I'm not going to attend an Ivy, yet still have an internship at a Merger Arb/ Credit Opp/ Event-Driven hedge fund, so definately looking forward to something like that.

It's definately inspiring reading about someone who has made it, thanks again for posting about this. :D
 
ANYONE can start a hedgefund with NO license as long as it is kept below 400k in value. i think this is true. any thoughts,please chime in.
 
Hey PTF let me throw another question your way that has to do with running a hedge/mutual fund that has me somewhat upset.

What drives you more crazy having to deal with clients or investors in the fund or employees who work for you at your fund?
I ask since we hired someone new to help me handle the increased research however, she is a recent college grad. who has a liberal arts degree and little business training experience what so ever.

I do great in the conference calls with clients and new investors however with the new person who is suppose to help me its like madding. Thanks
 
Looks like I've fallen behind on a few questions here.

malice, you don't need to go to Ivy League to be successful in the market. What you probably need most is an incredible drive to be successful. You can be successful in the hedge fund industry in one of two ways -- either become a top shelf chart reader and trader or generate your profits through quantitative and fundamental methods. I learned both but I prefer just reading charts. If you can go Ivy League, or get anything close to that then definitely do it. Every feather you can put in your cap wil help you along the way.

sophiekay

PTF, are there any advantages to opening a Hedge Fund if you are funding with 100% of your own money?----->>>> If you do this is would be considered an incubator fund, which you would use to attract investors down the road. If you don't plan on getting investors on board at a later date I see no advantage to starting a 1 person hedge fund but I'm not an expert in tax issues. Doing an incubator fund is VERY expensive. Instead, I just gave everyone my personal trading results and put a clause in the contract stating the return was unaudited.

Warrior4g
ANYONE can start a hedgefund with NO license as long as it is kept below 400k in value. i think this is true. any thoughts,please chime in.-------->>> Yes this is true and you must keep it under 15 non-related people as well. You still have to register with the CFTC as "exempt." Pretty funny huh? You have to register with the CFTC that you are exempt from registering. I got a kick out of that. Check out the various sections of rule 4.14, namely 2a.

timcar, I'm a one pony show so I don't have any employees. Perhaps someday. I farm out the accounting and tax and legal so it's just me. I've had mostly good relationships with investors but you will come across some odd ones from time to time. Then there are the ones who want to help you manage the fund by making suggestions here and there. This happens a lot if the market gets tough or you go through some drawdown.
 
Not marketing at all marketsurfer. In fact, if I did that I'd be in direct violation of Blue Sky Laws. I stated in the opening post that this thread is not a recommendation to buy, sell, or sell short any securities of any type, nor is it a solicitation to invest in any partnerships that buy, sell, or sell short any securities of any type. That statement still holds true. I'm not advertising anything here -- just trying to shed some light on how hedge funds operate for anyone who is interested in working for one or starting their own.

Quote from marketsurfer:

amusing marketing ploy thread.

:D :D :D
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ProfitTakingFool, is there anyway the moderator can make this a permanently active, readily available thread? I have noticed several newbies starting new threads asking questions that you have already answered here.

It may be a tremendous help if it was permanently at the top of the Career Forum. Just a suggestion.
 
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