Quote from Maverick74:
Sure, Don Bright is still running that model. But even Don told me, the writing is on the wall and he is unsure how long they, as a firm, can sustain that model. We have had private talks and I told Don those talks would stay private, but it was about the math that firms currently have to deal with and the numbers really aren't there. Every year Don has to cut his rates and every year, he has fewer traders trading less volume. This is a race to zero. This doesn't affect you personally only in that perhaps the firms like Bright Trading may not be around in 3 years. I've asked Don repeatedly why even bother. The numbers are horrible. I wouldn't recommend anyone to start a deposit prop firm today. One of the worst business I can think of.
What I see happening is this: the model is going to change. It's going to a zero rate model, this means you trade at firm cost. You give up a bigger % of your profits, but in return you get access to better technology and customized software (not off the shelf stuff like Sterling or Lightspeed). The technology would not be on par with say Citadel, but it would be top notch. This would be paid for through "some" of your p&l, and not from your commissions.
You would still get the leverage. But the focus would be to tap into the huge over supply of talented programmers out there and offer access to real customized solutions and zero to low cost of doing business. That is where I think the model is going in my honest opinion.
. I never said you were giving bad info. I just questioned the idea of a "perfect prop" from a trader's standpoint and if could survive given this low volume market. To me a perfect prop is just leverage + low rates and open access to your own money- is this still viable? In any case, I would definitely pay up more rate wise to maintain max payout. Higher rates for leverage? That's a great trade off for traders.