Maverick , it's a while that i wait for you to reduce private messages in your inbox ,it's already exceeds limits and i'm unable to send you private message.
Topsteptrader
- Thread starter deaddog
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Maverick , it's a while that i wait for you to reduce private messages in your inbox ,it's already exceeds limits and i'm unable to send you private message.
OK, there is some space. Don't overdo it!
https://www.bigmiketrading.com/vend...resident-ask-me-anything-ask-me-anything.html
This is the link to BMT Q&A, ask michael anything thread. the one on ET is dead. this still lives.
Ask him on the forum and he would respond to it in writing within a day.
Thank you Nemesis,
I will ask him questions over there. Did not know about such threads on Big Mike and ET.
I will ask him questions over there. Did not know about such threads on Big Mike and ET.
It makes a huge difference between making the profit objective of $1,500 vs. the $15k buffer before you can negotiate a higher lot size and loss limit.
You'd have to calculate how long you think it would take you and if you're willing to trade 1 to 3 lots while paying 40% of profits just to reach that buffer.
So the 30k makes the most sense from a combine perspective, but not from a funding perspective.
If you're going to use TST for funding, then the MAIN reason you do it is to trade with a lower capital outlay than trading in your own retail account, with the expectation that you will eventually scale up. You have to justify why you are paying the 35% haircut on the first 30 grand of profits, and 20% thereafter. Pekelo already posted the formula awhile back to compare the "true" account size vs. retail.
The other reason to trade with funding is to maintain a structured environment where you are basically insuring yourself against "blowing up" since they will auto stop you on the negotiated limit, whereas in your own retail account, you can potentially hold the draw until you get a maintenance liquidation, where they will force you out AFTER you've blown up.
So it really depends on what buffer you are required to maintain vs. the amount of lot size you can trade, before you can determine whether there is value in the funding.
Now, if they're going to make you first create a 15k buffer as the op mentioned, then there's no point in trying to "scale up" since you could trade decent sized lots with 15k in your own AMP account, and keep 100% of the profits while paying lower commissions, and you also won't have to worry about solvency of the backer.
The math is exactly the same whether you scale at AMP or TST. In fact, worse with TST. Nobody can seem to explain to me how "scaling up" is some sort of advantage. Do you get a free toaster oven if you scale. I mean you "do" own the losses right? Just like at Amp. So walk me through this why you or anyone for that matter thinks there is an advantage to scaling at TST.
Maverick,
I provided Pekelo's example above regarding true account size.
I come from the equities world, so I'm not that well versed on all of the daytrade margin rules for all futures products. However, his logic seems reasonable.
Now, the only caveat here is the TST rules specify that you cannot go back to a "zero" balance. In other words, since all funded accounts start with a zero balance, and each funded account balance is treated separately, not as a group, there is no room for a draw if it exceeds the buffer, or you lose Sr Trader status and get sent back to sim.
So then the question is: what buffer is reasonable to justify the "scaling up" of lot size, given the profit split and higher commissions vs. a retail account?
OK, let me be more specific. So here is the comment I hear a lot on this thread and Austin and I actually debated this for quite a few pages. Someone says, "oh, the only reason to use TST is so you can trade size or scale up. "
I say, what is the different between scaling up at Amp vs TST? To which this default person responds, oh no dude, with TST I can trade size. My response is, TST and Amp are exactly the same.
TST is only letting you go into their money for let's say 4500 on the 150k combine. So whether you trade a one lot or a 100 lot it doesn't matter. So what is keeping you or anyone from trading 100 lots with Amp? And whatever you lose, YOU lose. It's not like TST is going to let a guy drop 50k of their money. So if the argument is, well I don't want to lose size. Well, you ARE going to lose size. The only difference is you will lose size-4500 which is actually offset by the 40% you give them which actually means your expected net present value is less with TST then with Amp.
i asked Micheal Patak directly ,he replied : for a 30k account cushion is 1500$ and not 15k(just like their website) .after this 1500$ you will be eligible for :
make a request for a larger loss limit, more buying power, or a withdraws of your profits (after profit split).
also he said :
"If a Senior Trader feels they have a better advantage trading their own personal capital they may request a withdraw from their trading account with the equity partner and use the funds to open their own personal account. I am fairly certain you will not have the buying power that you had when you were backed with the equity partner."
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make a request for a larger loss limit, more buying power, or a withdraws of your profits (after profit split).
also he said :
"If a Senior Trader feels they have a better advantage trading their own personal capital they may request a withdraw from their trading account with the equity partner and use the funds to open their own personal account. I am fairly certain you will not have the buying power that you had when you were backed with the equity partner."
</pre>