To prop or not to prop...

buylo · Feb 14, 2007

Yes, because if you're hedging you're really not betting on a direction, right? Oh wait, what were those pompous assholes at LTCM betting on? Certainly not any ONE direction.

Don Bright · Feb 14, 2007

Quote from buylo:

Yes, because if you're hedging you're really not betting on a direction, right? Oh wait, what were those pompous assholes at LTCM betting on? Certainly not any ONE direction.

Correlated pairs and Mergers are a very time proven way to make money, especially when you collect interest on the short stock sales.

LTCM, and other "hedge" funds were not and are no involved in "hedging" per se' - mostly directional...a "hedge fund" is rarely neutral to whatever market they are involved in. "Reversal to the mean" is something that most quant's look for.

Don

ballsofgold · Feb 15, 2007

Don,
i understand that SSF's trade at Fair market value and make it hard to profit but i am not just legging in the arbitrage. When and if i am ready i will call the number but i am just not interested in moving to vegas. i would be happy to visit and dicuss what i am trying to do with you

Don Bright · Feb 15, 2007

Quote from ballsofgold:

Don,
i understand that SSF's trade at Fair market value and make it hard to profit but i am not just legging in the arbitrage. When and if i am ready i will call the number but i am just not interested in moving to vegas. i would be happy to visit and dicuss what i am trying to do with you

We have traders from Xiomen China to Dubai, no need to be here in Vegas.

Don

Don Bright · Feb 15, 2007

Quote from yip1997:

Don,

I didn't mean I trade unhedged position, I just wanted to know your haircut charge. It is very dangerous to say what is hedged, and what is not. Should we use statistical correlation as a means for perfect hedge? You might, but I don't. If I have my own way of hedging (my own system) that you might not agree, I will be faced to pay 1% a month. To be able to calculate the cost of doing business and assess his risk/reward is one of the key ingredients to be a successful trader.

We have so many hedges that we only concern ourselves with being within 20% of long $$ vs. short $$. Conversions of course are no haircut.

Don

ballsofgold · Feb 15, 2007

Good to know that i dont have to be in vegas, but might as well stop by teh office after leaving the bunny rannch

Quote from Don Bright:

We have traders from Xiomen China to Dubai, no need to be here in Vegas.

Don

qll · Feb 15, 2007

Quote from Don Bright:

We have traders from Xiomen China to Dubai, no need to be here in Vegas.

Don

i remember you still require people to visit your site and require series7.

Don Bright · Feb 15, 2007

Quote from qll:

i remember you still require people to visit your site and require series7.

All traders are licensed, of course. If they're profitable traders, they don't "need" to come here....of course most do to see what the top traders are doing currently. The last few groups from other firms (showing that they are experienced) have started without any training from here, but they will likely come at some point...all part of the interaction that works so well.

Don

biggerfish · Feb 15, 2007

Quote from ballsofgold:

Good to know that i dont have to be in vegas, but might as well stop by teh office after leaving the bunny rannch

Uh, interesting order of priorities...

qll · Feb 16, 2007

Quote from Don Bright:

All traders are licensed, of course. If they're profitable traders, they don't "need" to come here....of course most do to see what the top traders are doing currently. The last few groups from other firms (showing that they are experienced) have started without any training from here, but they will likely come at some point...all part of the interaction that works so well.

Don

could you tell me the details of the xiamen trader?
is it possible for me to contact him directly.
i just want to know
1 tax issue for foriegn prop traders
2 license for foreigners. online exam, or face to face to verify ID
3 visa issue for visiting vegas office

another quesiton, what is the rational to be lisenced, if i don't use too much of the firm leverage? the reason i don't want to be a pro is that i will lose the lowered commission from IB etc, unless i trade from my client account.