TopstepTrader Q & A

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i’ll probably be derided for saying this but i’m going to put it out there anyway: i think there is value in this service for a serious candidate at the beginning of his journey.
 
here we go again another copy cat!
2 /3 props ( yes props not hedge funds so no body can say these are not apples to apples to one up / tst and others) without need of paying test fees
in APAC region
Singapore + Australia = https://propex.com.au/trainee-traders
https://www.genkcapital.com/
https://www.genesistrading.com.au/training-program/


....by the way one common aspect of all these ( One up / tst/ T3 included) as compared to regulated firms like Bright, is that
1) The company that provides "Test/ training " is is normally a "Education provider"
2) The company which is supposed to "Fund" you is separate!
Where as with the regulated firms it is the same entity ( where one has to do series 7 or other state exams)
Again skeptic in me says "not illegal or fraudulent but why?" Why! perhaps to avoid the Regulatory hurdle.. becasue if it is one entity then probably traders joining will have to do these exams, meaning difficult to market the "Test" pool of prospects go down! so less lamb to the slaughter!
May be somebody with regulatory background can throw some light on this aspect
 
traderjo said:
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Again skeptic in me says "not illegal or fraudulent but why?" Why! perhaps to avoid the Regulatory hurdle.. becasue if it is one entity then probably traders joining will have to do these exams, meaning difficult to market the "Test" pool of prospects go down! so less lamb to the slaughter!...
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Been looking through the thread and have a couple of comments for you sir.

First, in peeking through your post history here on ET over the past 9 or so months, it seems like you are looking for hard and fast answers to all of your questions in many different "genres" of the markets. Futures, options, prop firms etc. This cries out to me that you are desperate to get into the game but want a no-loss solution now now now with no BS. That, you will not find in any trading genre I reckon'.

Second, and most important to the relevance of this thread...these prop firms and their "combines"...

In the past, I have had on-the-sideline discussions(arguments?) with folks like Xela et. al. about the veracity of the TST-type business models. I have always felt that these business models in and of themselves are sound and not "fraudulent", but that the way they are presented is less than genuine.

Through-and-through in all of your postings, traderjo, you have a healthy skepticism. And it is...healthy. But know what it is you are skeptical about before coming down so hard on any one idea.

My niggle with TST-type firms has always been that trailing drawdown, which when coupled with the "scaling plan" and profit ladder does not make sense. Just because you have a "50K combine" and make profit with 1-2 lots does not mean that after 10, 20, 30 days of profitability that you should scale up to their max lot-limit of what, 5 lots? You're still on a 50K account! If you make $50K profit on your $50K account and are up to $100K after doing 1-2 lots, why the hell would you then want to go hogwild and then do 5 lots?

Just take the 50K profit to the bank and continue on with 1-2 lots. But it seems this is not how the TST model works? They seem to coddle people into a false sense of security with the idea of just increasing your lot size as you make bits of profit.

This ties into your comments about "day-trading" margins. This is the other false-sense-of-security trap most people fall into.

Don't ever trade under daytrading margins, and stop thinking about notional value, which is what you seem to be doing here. Pound for pound, you will do much much better with any broker out there if you look at every trade you enter as if it was with exchange minimum margins for specerlators. For the ES as of now, that is $6,380 per contract.

When trading naked outright futures, don't get caught up in notional value because it means nothing. Don't get caught up in day-trading margin because it means nothing if you are trying to solve the puzzle of "having enough to daytrade".

So when you have a personal account of $50,000 and trade a contract or two, you then see the problem with the business model for people who do not have that money and gravitate towards these prop firms who have these odd "trailing drawdowns". In the real world, utilizing exchange margins, the trailing drawdowns do not exist. Just because your position is down by $2,000 does not mean that you MUST EXIT THE POSITION by market close or whatever, because you are fully covered by many decathousands for the exchange minimum. Programs like TST do not go that route. They seem to consider that if your open position is down by $2000, you MUST take that loss and continue on the next day as if your $50K position is now down to $48K. But that $2K loss is part of their ruleset. Your max loss for that day/week/month/combine is $2K, so guess what? You must now pay money to reset your account back to $50K and start over. But in a real account, if you lose $2K on the $50K account you are down to $48K. Tomorrow is another day.

For those not in the know (their demographic), that is great! For those that are in the know, it is terrible!

Going in with 10 lots, that $2K loss would be a $20K loss. If you would not do it with your own account, why try to do it with TST? Not to mention, you technically could not get into a 10-lot position in ES with $50K in a real account if you were to trade under exchange minimums in your head. At $6,380 per ct, you could get into 7 contracts. But that is using full exchange margin. This is why being over-capitalized is great, because 1 contract is just the $6,380...On a $50K account? Easy-peasy. No need to go all crazy with huge size. Have a comfy cushion!

The business models presented by these firms want to maximize their profits, so they offer these scaling plans.

These are just my thoughts on all of this, and not factual. It is an opine. I am just trying to put your mind at ease about how to approach the markets and all the ways you can get into it without so much disdain for every company out there.
 
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I was going to stop after my last amicable exchange with Xela,
but Overnight your long disection of my posts prompted me to write this
TO start with I can;t make out if you think my questioning is good or you are criticizing me!

I have no disdain for "every company out there" , just asking for factual info with no marketing BS,
Neither am I looking for "no-loss solution" I am not that silly.
Also doing a profile on my last 9 months and commenting that I am looking for a no risk solution is silly

My "healthy" skepticism comes from exp of understand a product or service, understanding and study of regulatory issues, looking at risk first and then reward, and once being on a creditor's committee where a white label OTC FX broker in first world country went belly with 47 million of client money!
I am all for taking market risk but not for the silly risks that comes with questionable products and services.

Yes I have been asking questions and help about the following and yes with healthy skepticism what is wrong with that" after all we are consumers to these vendors and we are entitled to ask these questions
- Client money safety
- Counter party risk and conflict of interest ( example Nadex market maker and nadex are owned by same parent somewhat similar to what FXCM in US was doing before it got banned)
- Regulated or not regulated
- Skulduggery of Binary Option/FX, do you know many in Asia are lured by FX registered in NZ, which outwardly looks robust first world financial regulatory body but read the fine print and you will realize that "Client money safety in NZ is piss poor as compared to UK)
- True nature of any product ( for example SGX has started something called Daily Leverage Certificates they sound like an leveraged ETF but when I inquired and looked deeper in to it's risk side, apart from market risk there is an "issuer risk" that is not overtly visible in marketing brochures, and there is only one issuer.. now average trader investor sometimes don't go in to that deep. I mean how many average mum and do know the diff risks involved in OTC against Exchange traded!
I do, so that makes me a villain does it!


Coming back to "pseudo prop" My persistence, point blank questioning is about the ethics of these ( which it seems you agree with my point) and in defense I showed 2-3 example of other "Props" which do exists for profit,Same way as one up TST etc but they do not follow this questionable model, no body is talking about them? why I wonder!

- Notional< as I said many times it is very easy to market "we will fund you to 125 K when in reality it is not hard cash of 125 K but just small margin that they need to put on table for 1 ES" so in 30K is there real 30 K us in a/c? which then can be leveraged using Futures own leverage
If it is not real 30K then why market it as 30 k / 150 K etc
and if it is real 30K then by using high leverage of Day trading on futures one should be able to trade 30 contracts ( 1000 per es Day trading margin

Then there is a common question about Hamster wheel possibility of test upon test.
Using your own words I think you supported the criticism many are making of these firms

",, For those not in the know ( their demographics) that is great , for those in the Know it is terrible" this simply means do these firms "prefer" to have thousands who are "not in the know" so they can be suckered!
LOL Exactly the point , those who are in the know or have some inclination of investigating can See through all this and would like to warn others but get told off !
- If this was free test for genuine hunt for talent then I would not have asked "What % of traders really do get funded" Propex and others dont have to answer that question becasue THEY DON'T charge anything for trader's who wants to try it
How blindfolded one can be my friend, when every other day these pseudo props pop up and what is the common theme pay us $199-$300 for a "test/ Gauntlet/ Combine etc... (a new frontier after OTC FX, Binary Option countless no of ICO;s )
While more reputable firms go about the business of recruiting on campus and open to all etc.

You say "The business models presented by these firms want to maximize their profits, so they offer these scaling plans..". this has nothing to do with fundamental question , which is simply about, " is this business model more about churning people through the "Test sales" revenue or finding profitable traders and make money on their talent , all points towards the "Churning model" and do a web search you will find many raising the same question not just me

Using your own words" these business models in and of themselves are sound and not "fraudulent", but that the way they are presented is less than genuine. AND THAT IS EXACTLY WHAT I AM SAYING TOO.
and in doing so I have been called a troll, accused being anti TST paid poster, etc.
any way sick of all this do whatever hell you guys want with your money but dont start labeling others who ask the questions:mad:
 
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"Don't ever trade under daytrading margins, and stop thinking about notional value, which is what you seem to be doing here. Pound for pound, you will do much much better with any broker out there if you look at every trade you enter as if it was with exchange minimum margins for specerlators. For the ES as of now, that is $6,380 per contract.

When trading naked outright futures, don't get caught up in notional value because it means nothing. Don't get caught up in day-trading margin because it means nothing if you are trying to solve the puzzle of "having enough to daytrade"."

Very well said @Overnight .

I agree with the "business" application of drawdown - in fact, they protect themselves from too much loss (themselves not especially you). But as you say - losses happen from time to time, this is the norm, tomorrow is also the day. I think, however, that it has one positive effect (of daily drawdown) - some people can give out too much in one session. They will lose and later try to get it back, then lose more, try again and so on and so one. Sometimes it's better to leave the screen - but they don't they don't have enough discipline and self conscious, It seems to me that such rule (but I'm talking about day limit) also has to help such people. On the real account you have a daily loss limit (set in the contract) - you set it manually, becouse it's for you.

"The business models presented by these firms want to maximize their profits, so they offer these scaling plans." - that's true. Every company want to make profit - this is business about - every business. Strange that some people don't understand that. That is why I think it is good for beginning (especialy if you are under capitalized) - to levarege amount of potential loss. And as soon as you can cover full margin and have some space to potential drawdown then it's obvious it's better to go on your own.
 
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"Every company want to make profit - this is business about - every business. Strange that some people don't understand that" are you kidding "Some people do understand business are for profit making" these "Some people" are just questioning the ethics of some firms" business practice" to get to that profit point.
Of course anybody in the business of genuinely funding others are going to be cautious and ask the trader to scale up , No rocket science there, Strange that "some people" can't understand the core of the question and criticism
 
But you didn't answer main question - do they force you to do this or do they force anyone ? Are the rules not simple ? They don't hide it - you can find rules on main site. And most important - can you deny that you are able to leverege your own potential risk up to 1:9 at the beginning ? This is not some socialist paradise - it has nothing to do with helping - it's business. Their busness and your business. The rules are simple, not hidden and you (and other ppl) have your own free will. And if someone is thinking in terms of money, risk, economical factors - then he does not bother with the names, marketing etc. Important is what you can get for what. Only this. if you can not think in these categories, think about whether you really want to be in this business. Because you know - there is a lot of manipulation, spoofing, inside trading etc. - and what ? If you loose money because of that you will going around and yelling "it's unethical, it's unethical ! give me my money back" ? (of course this sample has nothing to do with previous subject - it is about approach). Finally, I have a suggestion for you - send mail to Propex and ask them if they will be happy to hire you based on SIM results, academic and other stuff like that. Really - do it. Maybe you will understand something.
 
From the annals of TST...

MichalTr said:
Are the rules not simple ? They don't hide it -
More...

Since you seem to be new here, the rules were laughable originally and yes, not so simple. You could fail by a winning LENGTH of trading time ratio, (nobody ever heard of that before). That was just plain, unadultered total bullshit.

And the FTP originally wasn't advertised either, we had to force them to acknowledge it. All in all, WE made them improve the rules and transparency a lot.

But please carry on, maybe you will come up with an argument we haven't refuted 5 years ago. :)
 
MichalTr said:
I'm not Topstep employee or representative but I think I can give you guys some idea how it works. First of all - if you go with TST there are 4 brokers (with whom they cooperate) - Tradovate, NTB (Ninja), Stage5, Cunningham. You can easily check margins at this companies. For ES (day/full): 500/6380 (Tradovate, NTB, Stage5). So let's look at 50k combine:
5 (max lot) x 6380 = 31 900, + 2000 (max drawdown) = 33 900. Of course you can say you would use 500 day margin (but you need to know what is considering as "day"), than it would be 5 x 500 = 2500, + 2000 = 4500. But the question is - do you really want to trade up to 5 lots with your own 4500 account (that's a bit "brave" idea) ? I think we should forget about combine names, day/full margins and take a look at this from the other side. You pay 165/mo for "50 k combine". You can passed both combine and LTP after one month (then you subscription is cancelled). You need also pay for data (as pro), so for CME 85/mo. 265+85 = 350$. So you pay 350$ for 2000$ (max drawdown and you don't need your money to cover at least 4500). For 100k combine it's 325$+85=410$ for 3000$, for 150k combine it's 375$+85=460$ for 4500$. So you can calculate that for every 1$ you spent you get: 5,71$, 7,32$ or 9,78$. No matter how you looked at this - it's good deal. And if you don't want to split with anyone - that's still fine - you can take your 5k (no split) and go do your business (if you made it). Of course it is good deal if you are not one of guys who are paying month after month after month after month ... But still if you want to have some strict rules, be a part of something and you want to spend your money on it - you can pay month after month as long as you want - just your choice. From my perspective there are more pros thank cons - and the most important one (pure economic factor) speaks for the Topstep.
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Very nice write up MichalTr.

I agree with you.

Question? Where does the $265 come from?

Here is another conservative and capital protection I am doing as well other can pursue.

I don't feel I am confident to trade my own capital or even participate in TST right now, so I am doing the following.

1. Paper trade with my trading platform using TST rules in the 50K combine til I make 1)pass combine 2)pass FTP 3) get funded and make $5000.

I will start TST combine once the above is complete and I risk $0.00 of my own.
 
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