The biggest news EVER to hit EliteTrader

[VPhantom]

If you can get a high 6 figure or even a 1m trading account and make a modest return its much better than trying to get 1000% returns on $10k.

As true as that obviously is, that's irrelevant to this discussion: because of TST's very tight drawdown and scaling rules, it's functionally equivalent to maybe 10% the account size they claim when all is accounted for.

For example, the $150K combine's live trading starts with a 3-lot maximum size until you build equity, which then unlocks larger sizes progressively (like a personal account also does, depending on your money management). You're also never allowed to dip your balance into negative territory after the initial 10 days, where the maximum drawdown is temporarily if memory serves, $4500. So at $500/lot margin it is therefore equivalent to a $6K AMP account in that with that capital, after $4500 down you're out. At $400/month it takes just 15 months (less with resets!) to cost as much as blowing up a tiny AMP account.

So TST is just a tool to help people force themselves into a decent set of money management rules, it doesn't provide much access to capital at all.

 

[jem]

My thoughts are that if they really fund traders... then this is an interesting business model.
No complaints from me if they make a bit off their combines.

But... the reality is you would have to have a really solid edge to make money fast off those limits.

 

[William Rennick]

I've always wondered what the catch is with these guys who want to fund traders. Why take the risk on some unproven piker?

Rennick out

 

[Baron]

I've always wondered what the catch is with these guys who want to fund traders. Why take the risk on some unproven piker?

Rennick out

When you sign up with TopstepTrader, they run through a combine, or test period of trading, so that the your results can be established. If you are good enough, then you can earn a funded account and they take a percentage of your profits in exchange for giving you the capital to trade. So the combine helps them weed out all the "unproven pikers".

 

[VPhantom]

I've always wondered what the catch is with these guys who want to fund traders. Why take the risk on some unproven piker?

To add to @Baron's response, live traders are also demoted back to simulated combines if they dip back below $0 balance. This greatly limits their risk for loss.

 

[syswizard]

To add to @Baron's response, live traders are also demoted back to simulated combines if they dip back below $0 balance. This greatly limits their risk for loss.

All in all, I think it is a very solid program...much better than the standard prop firms of the past which were very sleazy and shady.
Think: Brendan Burns and Barclay Trading...what a scam that was.

 

[VPhantom]

All in all, I think it is a very solid program...much better than the standard prop firms of the past which were very sleazy and shady.

The rules are very clear yes, however when all is said and done, someone with enough self-discipline has limited use for them because of their highly restrictive live scaling plan, which restricts their effective funding down to a low-drawdown 1-3 lot stand-alone account. Now if live trading from the $150K combine started out at the full 20-lot maximum, it'd be very different story...