Hey everyone, my name is Jay Widdison and I'm a trader. Recently, I was looking into joining a proprietary trading firm that I would be able to trade with from home. Through my due diligence, I realized that getting all of the information about these firms was much more difficult that I had thought. Therefore, after researching several of them, I decided to start this blog so that anyone looking into prop firms would be able to come here and have all the information in one place. Let me start by introducing proprietary trading to anyone that isn't familiar. A prop firm is one which employs traders to trade directly into the markets to generate profits rather than to seek general investors and collect fees and percentages like that of a mutual fund or hedge fund. Prop firms will generally provide tools, training and data (at a cost). The firm will also provide the trader the ability to trade with the firm's capital, although most of them require the trader to come in with some risk capital of their own. They will also share in a traders' profits (typically ranging from 20-50 percent). Often, a firm will also profit from execution costs, so that each time a trader gets in and out of a trade, the firm will get a percentage of the spread. Over the next several posts, I will, in as much depth as possible, answer the following about each firm that I have researched and then I will continue to add posts as I research new firms:
1) How much start-up capital is a trader required to bring in?
2) How much are the desk fees and additional data and monthly costs?
3) Is training available or necessary and if so, what are the costs and time frame involved?
4) What kind of support does the firm offer? (coaching, live classes, email support, chat rooms, etc.)
5) Are there any licenses or certificates required? (Series 7 or 63, etc.)
6) Is there remote trading, in-house trading or both available?
7) What asset classes are utilized? (stocks, options, futures, forex, etc.)
8) What kind of trade frequency is required or focused upon? (scalping, day positions, swing, etc.)
9) What is the commission structure and how does the firm benefit from trade execution?
10) What are the profit splits and the time-frames for advancement in profit splits?
11) Is there a "lock-up" period for the traders' capital where they aren't able to access it or withdraw for a set period of time?
12) Is there a trading community where information and ideas can be freely exchanged and accessed?
Based on the results of this information, I will rank each firm with a basic "out-of-5-stars" rating system. The goal of this blog is to simply disseminate information more effectively, and to wade through a lot of the muck that you run into when digging for this knowledge. So far I have researched 6 firms and still waiting to hear from a couple more. These firms include: Bright Trading, Maverick Trading, SMB Trading, JC Trading, Affinity Trading, and Echo Trading. I'm waiting to hear from Cy Trading Group and Title Trading. Look for each firm to receive their own post dedicated to the above information. Thanks for taking the time to read.
Jay W.
