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Worldco Going Out of Business
- Thread starter Thug_Life
- Start date
Quote from Maverick74:
You know how traders are. They can't sit still long without trading. Apparently Assent even offered them a gross deal if you can believe that. Same payout and same rates as Worldco.
What is it with gross deals can someone explain this to me. I never understood why firms would offer this unless you are trading size. You are basically telling them that you are a shitty trader and you can't get net paychecks so the only way you can make a living is by getting part of your commissions back. Whatever happened to the days when guys would lie on their resume saying they went to Princeton and had a 4.0 to get a trading job. Now guys just come out and say they are not a profitable trader and they still get hired. I guess it tells you were the industry is going.
I remember a few years back at Worldco, if you didn't have an Ivy league degree they honestly did not return your phone calls. I'm dead serious. Walter even sent recruiters up to Harvard business school to get traders. This was at the market peak back in 2000.
What are you talking about? Most of prop traders in the golden years were guys of the street. Academics mean absolute squat in the market.
I know people who got hired at Worldco at that time and they werent from any Ivy League.
Quote from Mecro:
What are you talking about? Most of prop traders in the golden years were guys of the street. Academics mean absolute squat in the market.
I know people who got hired at Worldco at that time and they weren't from any Ivy League.
Well, if you remember correctly, back in 2000 and before there were no prop firms on wall street, none except Worldco. what you did have was retail shops that gave you leverage if you put up 25k. The number of firms that actually let you come in with zero capital back then was maybe three at the most. I know for a fact that Worldco pushed the Ivy League agenda. I'm not saying they didn't hire a guy here or there that didn't fit into that, but they really focused on really educated recent graduates. The guy off the street thing happened post bubble as the standards to get into these firms dropped very quickly. I'm not saying I agree with this, I'm just saying this was the way it was. And yes I agree with you academics don't know much about the mkt in general.
I first heard about this whole WorldCo ordeal on The Market Vu Show -- I think it was from someone who used to trade there. I was shocked -- I thought WorldCo was one of the few prop firms that made it through, especially since it seems as if trading has been making an uptick again in the past 6 to 9 months or so. The real question here is that does any real language exist in any of these LLC/prop firms to really protect a trader's capital in any way whatsoever? Or are they all basically the same? I would assume there would be some provisions in the charter that traders would be the first to be paid back or something. It just seems like there should be some rational mid-way between a normal brokerage firm's segregated client assets and a prop firm's non-segregated assets that can do a bit more to protect traders' hard-earned money. From what I understand in the Harbor days some people lost REALLY BIG. By the way, in case anyone may be interested, The Market Vu Show -- where I first heard about the WorldCo ordeal -- is a free voice-chat room on PalTalk where traders openly talk about trading strategies and other interesting topics throughout the trading day -- AND anyone can openly speak about anything that could help make traders more money, which makes it rather interesting to listen to as people debate out their ideas. Their website is "www.themarketvushow.com". Actually, I believe Ascent LLC (use to be Andover) is also one of their sponsors.
Quote from Ramon1:
I first heard about this whole WorldCo ordeal on The Market Vu Show -- I think it was from someone who used to trade there. I was shocked -- I thought WorldCo was one of the few prop firms that made it through, especially since it seems as if trading has been making an uptick again in the past 6 to 9 months or so. The real question here is that does any real language exist in any of these LLC/prop firms to really protect a trader's capital in any way whatsoever? Or are they all basically the same? I would assume there would be some provisions in the charter that traders would be the first to be paid back or something. It just seems like there should be some rational mid-way between a normal brokerage firm's segregated client assets and a prop firm's non-segregated assets that can do a bit more to protect traders' hard-earned money. From what I understand in the Harbor days some people lost REALLY BIG. By the way, in case anyone may be interested, The Market Vu Show -- where I first heard about the WorldCo ordeal -- is a free voice-chat room on PalTalk where traders openly talk about trading strategies and other interesting topics throughout the trading day -- AND anyone can openly speak about anything that could help make traders more money, which makes it rather interesting to listen to as people debate out their ideas. Their website is "www.themarketvushow.com". Actually, I believe Ascent LLC (use to be Andover) is also one of their sponsors.
By law I believe nothing can be done to better protect trader money, because traders are limited partners, which automatically makes them unsecured creditors (or should I say debtors? whichever it is, you get the point). However, the misrepresentations and scandalous actions of the firm down the stretch are a different matter.
Quote from Maverick74:
Apparently Assent even offered them a gross deal if you can believe that. Same payout and same rates as Worldco.
Hmmm. How can you have a gross deal with the "same (commission) rates as Worldco" ? The whole purpose of a gross deal is that you have no costs deducted from your gross profits.
Quote from axehawk:
Hmmm. How can you have a gross deal with the "same (commission) rates as Worldco" ? The whole purpose of a gross deal is that you have no costs deducted from your gross profits.
Actually here is how worldco did it. You could either make money gross or net. So say for the month of October you are paying .65 in commissions and you made 20k gross and paid out 25k in fees. Well they would pay you let's say 30% of 15k. But if next month you made 30k gross and paid 20k in fees then you got paid 99% of 10k. This is of course part of the problem. This firm had margins as low as a grocery store without the volume though. However they felt if they didn't offer this, many of their traders would have quit.
Seems to be a lesson here, never throw good money after bad.
Quote from Maverick74:
Actually here is how worldco did it. You could either make money gross or net. So say for the month of October you are paying .65 in commissions and you made 20k gross and paid out 25k in fees. Well they would pay you let's say 30% of 15k. But if next month you made 30k gross and paid 20k in fees then you got paid 99% of 10k. This is of course part of the problem. This firm had margins as low as a grocery store without the volume though. However they felt if they didn't offer this, many of their traders would have quit.
Seems to be a lesson here, never throw good money after bad.
i am not sure whether it changed month to month. my recollection speaking to a trader was that you had to make a request for a change and could not readily switch back and forth
another problem was they offered big traders extremely low commissions .0025 to .003 which may have covered marginal cost but certainly not average cost. marginal cost leaves out all fixed expenses. even so it is questionable they could cover marginable costs
Quote from zdreg:
i am not sure whether it changed month to month. my recollection speaking to a trader was that you had to make a request for a change and could not readily switch back and forth
another problem was they offered big traders extremely low commissions .0025 to .003 which may have covered marginal cost but certainly not average cost. marginal cost leaves out all fixed expenses. even so it is questionable they could cover marginable costs
LOL. Let me tell you something about Worldco. Nothing is etched in stone. Sure they don't want you to switch back and forth. Did guys do that? You bet they did. All you had to do was go to your group leader and tell him you were thinking of going to another firm and bamm, switched. It's easy. This is how the firm operated. They were held hostage by many of the traders there. All you had to do was threaten to leave and you got anything you wanted. More monitors, special checks, gross checks, net checks, seat by the window, you name it. Of course you had to be trading some volume though. A guy doing 10k shares a day didn't even have his name on the computer. LOL. It really was a caste system there. I have to tell you. The stories of how they ran that place would make for one hell of a book. Bestseller no doubt. Business schools around the country would have to re-think everything they have taught about making money the last 200 years. LOL.