Retail only allows 2x - 4x margin and depending on if you have 25k or more you will only be allowed a few trades a week due to SEC rule if you are trading US stocks. With a new trader its very easy to try higher shares size with 10x margin or 20x margin with a $5000 account like most of these props allow. I'm not talking about a prop where you are working for someone else. The one that I have is where you trade there account but P/L comes out of my sub account. I have to say I would never have a high priced retail account I like my prop its the best prices I have ever found.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
Why most self funded Prop traders fail
- Thread starter garfangle
- Start date
Quote from garfangle:
I imagine most prop traders think of themselves as mini hedge fund managers, just with a small nut (asset base).
"just with a small nut (asset base). "
Well I guess small nut(s) could be the problem :eek:
But from my experience the problem is OVERTRADING. We've all been there.
Do the people hold real size trade it in and out all day? I suspect not.
Quote from minmike:
That was a pretty stupid post. I have never understood why people find stocks "risker" than futures. They have a different risk, but not more. If used properly, I think that they can have a whole lot less risk.
I said a prop account gives you a lot more margin then a retail account plus allows people with less then 25k to daytrade. That means you are able to blow out your account faster. I never said anything about futures account. With 20 times margin as with my prop gives me you only have to make a few trades and $5000 will be gone in no time.
please allow me to ask the obvious--- why does being capitalized equal greater success? I realize capital will allow one to last longer, but is this what it takes to succeed?
Forgive my bluntness, but it seems to me that being well capitalized only helps the prop firm by having the trader "last longer" hence creating more fees/commissions prior to blow out.
if you are not suited for trading, 150k or 5k down will not make a difference in your success. what am i missing?
thanks,
surf
Forgive my bluntness, but it seems to me that being well capitalized only helps the prop firm by having the trader "last longer" hence creating more fees/commissions prior to blow out.
if you are not suited for trading, 150k or 5k down will not make a difference in your success. what am i missing?
thanks,
surf
Quote from marketsurfer:
please allow me to ask the obvious--- why does being capitalized equal greater success? I realize capital will allow one to last longer, but is this what it takes to succeed?
Forgive my bluntness, but it seems to me that being well capitalized only helps the prop firm by having the trader "last longer" hence creating more fees/commissions prior to blow out.
if you are not suited for trading, 150k or 5k down will not make a difference in your success. what am i missing?
thanks,
surf
Surf,
If you have a million dollars and make 10% a year, you can walk home with a 100k a year income. And making 10% a year or just under 1% a month is not terribly tough.
With 5k Surf, you need to make a 2000% return to make the same money. Not going to happen. The guy that makes 10% a year takes very little risk and enjoys a nice income. The guy with 5k has to shoot for the moon every day, live under an incredible amount of stress and his odds of success are slim to none, and slim left town. Follow?
Quote from Maverick74:
Surf,
If you have a million dollars and make 10% a year, you can walk home with a 100k a year income. And making 10% a year or just under 1% a month is not terribly tough.
With 5k Surf, you need to make a 2000% return to make the same money. Not going to happen. The guy that makes 10% a year takes very little risk and enjoys a nice income. The guy with 5k has to shoot for the moon every day, live under an incredible amount of stress and his odds of success are slim to none, and slim left town. Follow?
makes some sense, maverick. thanks!