You said it all right there 'we'd all be rich' most people are so intent on getting rich and fast their GREED is what makes them lose. ...enough said!
what kind of training do you get at a prop?
- Thread starter dv4632
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You said it all right there 'we'd all be rich' most people are so intent on getting rich and fast their GREED is what makes them lose. ...enough said!
that's cool, that's the way I did it for the most part. To be honest with you, I never traded stocks. But that is because there were so many little things that a retail trader had to learn, and I figured I either wasn't smart enough or didn't have the patience for.
But back then we were tading for 1/4's and halfs, now they trade for pennies, and there's only so many pennies to go around, and I don't want to split my share up with JPM unless I at least have some idea how they are doing it.
Yes, I remember. when I actually first started I didnt even have a computer, I would look at FNN and the newspaper, it was amazing how lucky I got. Then In 2000 I finally got a computer and opened an acct with Ameritrade. They did not have a trading platform at that time but like a fool I started daytrading off their snap ticket and yes it was luck, when a stock would start running I wuld just jump in. LOL They finally got a trading platform a few years later and thats when I really started to learn.
Dont get me wrong it's not easy but it really is not that hard. And now I have my little edge that seems to work really good. It's nothing thats all mine in fact it looks to me like many people have the same edge.
Anyway, I used to be greedy and then I learned to take what the market gives you. If you do it that way you will be amazed at how much you can make in just 1 day without getting greedy....Greed kills!
I'd like to chime in.
Nowadays, firms are structured largely around strategies (Bright around pairs trading from what I understand, WTS for high-frequency, etc. ) A lot of firms have profitable strategies but it's really up to the trade to implement it correctly in the market. The problem is that a lot of times, the strategies are non-transferable. For instance, if you are running an algorithm that is adding millions of shares of liquidity putting orders out on the bid, you'll need a dirt cheap commission rate. Very few firms offer rates low enough to make the margin return on one of these algorithms a worthwhile investment.
The Brothers are dealing with GS and I've heard great things about Redi. I'm sure they offer substantial value for specific strategies and/or styles of trading.
Getting good training is a lot like going to school. A lot of firms will make tons of resources available that you won't get trading retail (i.e. low rates, a group of profitable traders to trade along with, routing abilities, education materials, etc) but it ultimately comes down to making the grade. I compare it to medical school in the states. It is extremely competitive and the barrier to entry is very high. In this case, the downside risk is a lot less than shooting for med school and failing (blowing out of your account won't cost you anywhere near what failing out of med school will). If you take it seriously and don't expect somebody to teach you how to be profitable. You are going to have to put in 50-60 hours of work per week in order to succeed.
Nowadays, firms are structured largely around strategies (Bright around pairs trading from what I understand, WTS for high-frequency, etc. ) A lot of firms have profitable strategies but it's really up to the trade to implement it correctly in the market. The problem is that a lot of times, the strategies are non-transferable. For instance, if you are running an algorithm that is adding millions of shares of liquidity putting orders out on the bid, you'll need a dirt cheap commission rate. Very few firms offer rates low enough to make the margin return on one of these algorithms a worthwhile investment.
The Brothers are dealing with GS and I've heard great things about Redi. I'm sure they offer substantial value for specific strategies and/or styles of trading.
Getting good training is a lot like going to school. A lot of firms will make tons of resources available that you won't get trading retail (i.e. low rates, a group of profitable traders to trade along with, routing abilities, education materials, etc) but it ultimately comes down to making the grade. I compare it to medical school in the states. It is extremely competitive and the barrier to entry is very high. In this case, the downside risk is a lot less than shooting for med school and failing (blowing out of your account won't cost you anywhere near what failing out of med school will). If you take it seriously and don't expect somebody to teach you how to be profitable. You are going to have to put in 50-60 hours of work per week in order to succeed.
The challenge with being totally reliant upon a firm to teach you is that the firm suffers from complete exposure to that singular strategy, and you as one of the trained monkeys goes down with the ship.
I have seen alot of it here in Chicago.
There is/was a prominent fixed income spread trading firm located in the NW suburbs - their strategy was to fade one and two sigma moves. They trained new hires to do it - the entire firm did it. Worked from the late '90's until the early 2000's - then fading moves along the yield curve became an invitation to disaster.
Same basic story for GHC as well.
No diversity - the entire firm was fantastically exposed to like market moves.
These days, the futures prop groups In Chicago and New York want to be pitched with proven strategies - and then the principals decide whether to back it or not.
I have seen alot of it here in Chicago.
There is/was a prominent fixed income spread trading firm located in the NW suburbs - their strategy was to fade one and two sigma moves. They trained new hires to do it - the entire firm did it. Worked from the late '90's until the early 2000's - then fading moves along the yield curve became an invitation to disaster.
Same basic story for GHC as well.
No diversity - the entire firm was fantastically exposed to like market moves.
These days, the futures prop groups In Chicago and New York want to be pitched with proven strategies - and then the principals decide whether to back it or not.
This is true. To get a fully-backed trading contract, you're going to have to convince a firm/individual that your strategy is successful. Usually, they want verifiable PnL statements and not some demo account performance or paper trading. Only live performance is taken into account. The days of being salaried or hired fully-back to trade capital are over. We're back to a more stable performance-based industry. The firms just aren't willing to take the risk anymore. It takes tons of time to go through all the requests for fully-backed positions (I'm sure every prop firm gets dozens if not hundreds of requests a year)
I hear that one as well time and time again; 'nobody wants to take risk'. It seems like they want arbitrage and spread trading and highly correlated relative value strategies ( like 'lead-lag' ). If you have that on an automated platform that is already proven - then that seems to be the preferred flavor these days.
The days of selling hundred of contracts into an ES rally because 'it's too rich' are long gone - at least on someone else's dime.