skc
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- 12 August 2008
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Lol. I was wondering why I struggle to size up so much. I will try following the above routine next week.
yeah. Get some bamboo, sharpen it, stick it under your finger nails and slowly insert it into your nail beds over a 4 hour period. Once you are about to be physically sick walk to the corner of your desk and smash your head into the corner of it as hard as you can. Once you wake up call up someone and pretend they are the risk department and beg and promise that you will do better in the arvo and can they increase your daily loss limit just this one (again!).......Then proceed to zig when you should zag. until you dig another hole that makes you spew all over you keyboard. thankfully this blows up your computer and you finally stop trading for the day and go to the pub which will finish up at the jack the rippers and dropping another $500 that you will not remember tomorrow.. That will get you partly used to trading size...... only partly.
Lol. I was wondering why I struggle to size up so much. I will try following the above routine next week.
yeah. Get some bamboo, sharpen it, stick it under your finger nails and slowly insert it into your nail beds over a 4 hour period. Once you are about to be physically sick walk to the corner of your desk and smash your head into the corner of it as hard as you can. Once you wake up call up someone and pretend they are the risk department and beg and promise that you will do better in the arvo and can they increase your daily loss limit just this one (again!).......Then proceed to zig when you should zag. until you dig another hole that makes you spew all over you keyboard. thankfully this blows up your computer and you finally stop trading for the day and go to the pub which will finish up at the jack the rippers and dropping another $500 that you will not remember tomorrow.. That will get you partly used to trading size...... only partly.
Is it your pairs trading that you are trading Prop? I'd imagine trade execution gets pretty hard pretty quick with scale. Must be nice to have some mentors around to help guide through that.
TH mentioned no risk - question to follow that up. Is it actually possible to trade your own capital along side? Can you leave your profit in to build. Is their any counterparty risk if you had your own funds/profit in if the prop shop failed?
Also is the profit split after a charge for capital/hurdle rate?
Can't think of the mutually beneficial equivalent for those more investment focused.....yet. Have you heard of anything?
A mutual fund manager?
Thanks for taking the time SKC
Your description of capital requirement from the shops perspective is pretty much how I assumed it would be which prompted the question as to whether you could run your own capital along side.
Last question/thinking out loud (ignore if you wish)
Do you get enough time and remaining emotional energy to still maximise your own capital? If you can’t do both adequately does the potential of the prop scale dwarf that consideration – Is there a tipping point?
In fact the capital requirements of the prop shop to back a good trader dramatically drops as time goes on. As you don't take all your profit each month, and some take hardly any, the trader actually becomes self funding to some degree by leaving his/her share of profit with the firm.
So you can leave profit in? I sort of read SKC's response as you can't. I would think if you can apply your skills to your own capital at the same time its all the better for the trader (bar possible counterparty risk)
I assume the only reason not to take all your profit each month would be to smooth your 'monthly equity/payment curve'?
I cant think of any other reason not take your payment as its just idle money not earning you a return? tax perhaps?
Oh no they prefer you to leave it in. If you were a bit sceptical you would say cuz it is funding their operation. But i see it as building a physiological buffer against draw-down. Its probably somewhere in between but you don't want to have a bad start to the month and be looking at a daily account balance in negative.
Oh but as skc did say you don't have a capital base to work off. You don't use tradition risk management position sizing. in fact you blow the F out of the typical positions sizing models. So it is not a matter of if you have "trading capital" in there or not as that has nothing to do with position size. They don't say ok you max size is 10 contracts + 3 from your own capital.
Do you get enough time and remaining emotional energy to still maximise your own capital? If you can’t do both adequately does the potential of the prop scale dwarf that consideration – Is there a tipping point?
As you don't take all your profit each month, and some take hardly any, the trader actually becomes self funding to some degree by leaving his/her share of profit with the firm.
Another Propex trader here. Whilst I feel their in house training could do with some refinement there is no denying they success they are having with their trainees.
Hi there aussiefx. What are you trading? Are you in one of their offices?
I'm trading bonds and equities currently. Yep I trade from the office and looking at doing a few nights at home soon.
Just wondering if anyone from the darkside knows or is able to find out for me what sort of minimum live track record in terms of time I should build up before considering trying to get in by way of the back door?... so to speak
I know it will depend on a lot of things but even a guesstimate would be good
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