Does any serious funding opportunities exist today for real traders?

[JohnnyForex]

Hello all.

Does any serious funding opportunities exist today for real traders?

Pay to trade in simulator companies are not what I have in mind.

Thank you.

Johnny

 

[Farm Yard Forex]

If you can provide decent enough results over a good time period to a bank or professional accounts with brokers they might be able to fund you.

 

[Ian Keith]

Check out tenTOPtraders. https://www.tentoptraders.com/
Free if you are good enough.

 

[AC007]

I am looking into these guys. There are some serious sceam artists about.

 

[JohnnyForex]

Thank you guys.

 

[Parky]

Yes but it is chicken and Egg. If you are a successful trader, with a proven live trading model, then you can get leverage funding which would enable you to take your trading to the next level. But most professional trading groups will expect you to have some skin in the game. If you are a successful trader who cannot/will not back yourself, well then you cant be very confident in your own abilities, so why would anyone else?

 

[JohnnyForex]

Yes but it is chicken and Egg. If you are a successful trader, with a proven live trading model, then you can get leverage funding which would enable you to take your trading to the next level. But most professional trading groups will expect you to have some skin in the game. If you are a successful trader who cannot/will not back yourself, well then you cant be very confident in your own abilities, so why would anyone else?

Hello,

Where would I access such a group or funding, then?

I agree that it's a catch 22 or chicken and egg situation as if you're a good trader you might not want to trade external funds. Conversely, without a good track record you probably ain't going to get access to any funds or external capital.

Looking back on my prior losses or lack of success so far, a big part of the equation is that I've been undercapitalized and traded too large in order to make a "worthwhile" return.

For example, if I had $1M in my trading account, I'd be very happy on a personal level if I could generate a 15 % return p.a. Knowing this I could trade a much smaller size and be more selective knowing I don't need to make a killing.

However, with a $10K trading account, a 15% return p.a. wouldn't barely cover the cost of my yearly data fees. As such, it puts you at a higher pressure to perform in order to generate larger returns. Which again could easily lead to "ruin".

Johnny

 

[DT]

Where would I access such a group or funding, then?

Looking back on my prior losses or lack of success so far...

You probably wouldn't because of the latter.

There is a meme in poker re: some bad players where they wish they had the bankroll to "move up to where they respect my raises", that somehow they could be good at higher stakes games despite all the evidence to the contrary from their actual play.

On what basis is someone else going to fund you if you're not already making money?

Does it make sense for what you're doing vs just taking advantage of the leverage on offer to anyone at various US FCMs?

 

[JohnnyForex]

You probably wouldn't because of the latter.

There is a meme in poker re: some bad players where they wish they had the bankroll to "move up to where they respect my raises", that somehow they could be good at higher stakes games despite all the evidence to the contrary from their actual play.

On what basis is someone else going to fund you if you're not already making money?

Does it make sense for what you're doing vs just taking advantage of the leverage on offer to anyone at various US FCMs?

Hello, DT,

Yes, you're right. I don't expect anyone to fund me if I can't provide a good track record which is why I don't see any way moving forward other than trading my own small account.

As wrote in my prior post, though. I firmly believe that a big part of my lack of consistent success comes from trying to make outsized returns trading a smaller account and as such taking too large risks. So, moving forward I will be more cautious and focused on simply making money with what I have and maybe at some point I can produce a track record that someone would pay attention to. That means trading smaller size and collecting peanuts at this point.

Regarding funding, I would/could also consider options where I deposited my own capital as a cushion or first-loss capital. As an act of good faith and insurance for someone who would be interested in funding me.

There are guys less able than me who are managing money and collecting fees, but obviously they're more connected and well known in the industry. Some of them more like salesmen/brokers than actual traders. I know at least one in my neck of the woods who launched a fund without any track record and he's now had (I believe) a real wake up call.

Thank you.

 

[flashman57]

Hello, DT,

Yes, you're right. I don't expect anyone to fund me if I can't provide a good track record which is why I don't see any way moving forward other than trading my own small account.

As wrote in my prior post, though. I firmly believe that a big part of my lack of consistent success comes from trying to make outsized returns trading a smaller account and as such taking too large risks. So, moving forward I will be more cautious and focused on simply making money with what I have and maybe at some point I can produce a track record that someone would pay attention to. That means trading smaller size and collecting peanuts at this point.

Regarding funding, I would/could also consider options where I deposited my own capital as a cushion or first-loss capital. As an act of good faith and insurance for someone who would be interested in funding me.

There are guys less able than me who are managing money and collecting fees, but obviously they're more connected and well known in the industry. Some of them more like salesmen/brokers than actual traders. I know at least one in my neck of the woods who launched a fund without any track record and he's now had (I believe) a real wake up call.

Thank you.

It is sort of chicken and egg - I learned to trade working in the hedge fund industry. There might be a prosaic reason why most great traders come from banks or hedge funds - they have a salary, giving them time at the start of their career to learn what works and what doesn't without being worried about making rent (not to mention having an informational and analytical edge)

But, a couple of thoughts, if you are really thinking about this long term and building a career as a pro trader:
- Why not just concentrate on pulling together 6-12 months of low volatility performance with a decent Sharp (setting aside your data costs) and then go to get funded?
- Can you quantify your system and provide backtests for 5-10 years at least, to back up a year of real performance?

There are plenty of prop shops which will provide $1mm capital if you can sustainably pull a few points per day out of the S&P or whatever - however, they will expect demonstrable proof before funding you. When I looked at them 10 years ago, before I was in HF, they either didn't provide a salary or gave you a $1-2k pcm draw, which you had to repay before the profit split (assuming you were in profit). Why not do one of these funded trader challenges from FTMO or whoever? It only costs a few hundred $ I think? If you fail, at least you will know why and what you have to improve. If you win, then you're on your way.

tl;dr Yeah there are serious funding opportunities, but it's on you to prove you are a real trader

 

[JohnnyForex]

It is sort of chicken and egg - I learned to trade working in the hedge fund industry. There might be a prosaic reason why most great traders come from banks or hedge funds - they have a salary, giving them time at the start of their career to learn what works and what doesn't without being worried about making rent (not to mention having an informational and analytical edge)

But, a couple of thoughts, if you are really thinking about this long term and building a career as a pro trader:
- Why not just concentrate on pulling together 6-12 months of low volatility performance with a decent Sharp (setting aside your data costs) and then go to get funded?
- Can you quantify your system and provide backtests for 5-10 years at least, to back up a year of real performance?

There are plenty of prop shops which will provide $1mm capital if you can sustainably pull a few points per day out of the S&P or whatever - however, they will expect demonstrable proof before funding you. When I looked at them 10 years ago, before I was in HF, they either didn't provide a salary or gave you a $1-2k pcm draw, which you had to repay before the profit split (assuming you were in profit). Why not do one of these funded trader challenges from FTMO or whoever? It only costs a few hundred $ I think? If you fail, at least you will know why and what you have to improve. If you win, then you're on your way.

tl;dr Yeah there are serious funding opportunities, but it's on you to prove you are a real trader

Hello, flashman57,

Thank you for your interesting and considerate reply.

Learning to trade in a professional capacity like you’re saying would definitely be ideal, but I think it’s not an option for me as I’m by now probably too old (38) and don’t have the right background (engineering and not finance/data science). Not to mention that proprietary trading doesn’t really exist here in Norway. Mostly, it’s only brokering that’s done here in Norway and as far as I know there’s less than 10 hedge funds doing any actual short term trading. Of course, I could move if that were an option, but I imagine the competition is fierce and the opportunities few.

Get funded trader challenges:

I don’t see these as serious alternatives for getting funding. At best, they give you a shoestring to trade on and as soon as you break a rule you’re gone. Regardless of how good your performance was prior to that. Bottom line is they’re not really looking to fund traders. You will never get any funding beyond the profits you accumulate yourself. So, basically, as soon as you’re funded and in profit, you might as well withdraw your money and trade it yourself for a 100 % profit split.

What I’m currently doing:

I funded an account with $11K and started trading it part-time (while holding a full-time job) in September. By the end of September I was up 49 % with 17 winning days and 5 losing days trading mostly one e-mini S&P 500 contract. My account peaked at $17 200 and I’m currently in drawdown after losing my balance Monday and Tuesday this week.

I got sloppy, greedy and complacent after a very good September. Most of my losses can be attributed to trading when I shouldn’t be trading and not actual poor performance.

I’m determined to get back on track, though.

My goal is to do this full-time, but I have mostly given up on getting funding or doing this professionally. So, I probably just have to trade part-time until I’ve grown my account sufficiently to be able to live off my trading.

It’s back to the chicken and egg. If I can grow my account substantially and have a good track record – would I really want or need funding?

Don’t get me wrong. I’d jump at any opportunity if it was a good one, but it seems like maybe by the time I have something to show somebody, I might not really need it?

Of course, if someone would really stake me allowing me to trade big size at one point, it would change the game for me. If an option, I could also provide my own capital for a cushion or act of good faith.

It may sound delusional and I won’t judge anyone if they laugh, but I firmly believe I’m a very able trader having tracked this market for a long time and having my trading backed by a solid methodology. While I use a predictive/statistical model custom made to my requirements, it’s still a discretionary approach at the end of the day. So I wouldn’t be able to provide any automatic back-tests.

Thank you in advance for any further guidance.

Best,

Johnny

 

[flashman57]

Hello, flashman57,

Thank you for your interesting and considerate reply.

Learning to trade in a professional capacity like you’re saying would definitely be ideal, but I think it’s not an option for me as I’m by now probably too old (38) and don’t have the right background (engineering and not finance/data science). Not to mention that proprietary trading doesn’t really exist here in Norway. Mostly, it’s only brokering that’s done here in Norway and as far as I know there’s less than 10 hedge funds doing any actual short term trading. Of course, I could move if that were an option, but I imagine the competition is fierce and the opportunities few.

Get funded trader challenges:

I don’t see these as serious alternatives for getting funding. At best, they give you a shoestring to trade on and as soon as you break a rule you’re gone. Regardless of how good your performance was prior to that. Bottom line is they’re not really looking to fund traders. You will never get any funding beyond the profits you accumulate yourself. So, basically, as soon as you’re funded and in profit, you might as well withdraw your money and trade it yourself for a 100 % profit split.

What I’m currently doing:

I funded an account with $11K and started trading it part-time (while holding a full-time job) in September. By the end of September I was up 49 % with 17 winning days and 5 losing days trading mostly one e-mini S&P 500 contract. My account peaked at $17 200 and I’m currently in drawdown after losing my balance Monday and Tuesday this week.

I got sloppy, greedy and complacent after a very good September. Most of my losses can be attributed to trading when I shouldn’t be trading and not actual poor performance.

I’m determined to get back on track, though.

My goal is to do this full-time, but I have mostly given up on getting funding or doing this professionally. So, I probably just have to trade part-time until I’ve grown my account sufficiently to be able to live off my trading.

It’s back to the chicken and egg. If I can grow my account substantially and have a good track record – would I really want or need funding?

Don’t get me wrong. I’d jump at any opportunity if it was a good one, but it seems like maybe by the time I have something to show somebody, I might not really need it?

Of course, if someone would really stake me allowing me to trade big size at one point, it would change the game for me. If an option, I could also provide my own capital for a cushion or act of good faith.

It may sound delusional and I won’t judge anyone if they laugh, but I firmly believe I’m a very able trader having tracked this market for a long time and having my trading backed by a solid methodology. While I use a predictive/statistical model custom made to my requirements, it’s still a discretionary approach at the end of the day. So I wouldn’t be able to provide any automatic back-tests.

Thank you in advance for any further guidance.

Best,

Johnny

Hi Johnny,

Fair enough, it sounds like you have this worked out. I suspect your main challenge will just be getting to consistent profitability and then it will come together for you. As far as delusional goes... if you can do it, then it's not delusional

If you check out these guys, http://hold.com/careers.html, they are a random prop firm I found, and they have an opening for a 'Proprietary Equity Trader', providing funding, technology, 50x intraday leverage, help with your FINRA registration, and a benefits package etc - maybe US only though.

Another one here, although this one is quant-focused, for 'Experienced Futures Trader' - https://www.kershnertrading.com/#/careers, they want 3+ years track record, which is pretty typical I think.

These were just the first two firms I clicked on from a big list, so basically what I'm saying is, there are ways and means, especially if you can put up $10k-25k of your own capital on a shared first loss basis, but you do need that track record, prob minimum 1-2 years, preferably 3+.

Best of luck!

 

[JohnnyForex]

Hi Johnny,

Fair enough, it sounds like you have this worked out. I suspect your main challenge will just be getting to consistent profitability and then it will come together for you. As far as delusional goes... if you can do it, then it's not delusional

If you check out these guys, http://hold.com/careers.html, they are a random prop firm I found, and they have an opening for a 'Proprietary Equity Trader', providing funding, technology, 50x intraday leverage, help with your FINRA registration, and a benefits package etc - maybe US only though.

Another one here, although this one is quant-focused, for 'Experienced Futures Trader' - https://www.kershnertrading.com/#/careers, they want 3+ years track record, which is pretty typical I think.

These were just the first two firms I clicked on from a big list, so basically what I'm saying is, there are ways and means, especially if you can put up $10k-25k of your own capital on a shared first loss basis, but you do need that track record, prob minimum 1-2 years, preferably 3+.

Best of luck!

Hello again, flashman56,

Thank you for providing this information to me. Very interesting. You mentioned picking these off a big list. Would it be possible to share that list with me? Feel free to contact me through private message if that’s better for you.

I was in contact with one firm earlier. I think it was T3 Trading Group. They offered a deal if I put up capital. The problem with that deal was that it didn’t give me any advantage over trading my own account. Maybe the commissions were slightly better, but considering that I had to put up my own first-loss capital I could simply trade with the same kind of leverage (I think they had a $2K daily loss limit) using my own retail discount broker which offers $500 intraday margin.

The one advantage was that I could hold overnight through the electronic close with more contracts than possible with my current account would allow, but that’s not really a concern for me as I’m generally flat by the electronic close.

However, maybe if I put up capital with such a firm and traded well, they would eventually stake me and give me a more profitable deal?

I really want to make this work out, so I do need to make sure I explore these opportunities for sure.

Thanks again.

Johnny

 

[JohnnyForex]

September:

 

[flashman57]

Hello again, flashman56,

Thank you for providing this information to me. Very interesting. You mentioned picking these off a big list. Would it be possible to share that list with me? Feel free to contact me through private message if that’s better for you.

I was in contact with one firm earlier. I think it was T3 Trading Group. They offered a deal if I put up capital. The problem with that deal was that it didn’t give me any advantage over trading my own account. Maybe the commissions were slightly better, but considering that I had to put up my own first-loss capital I could simply trade with the same kind of leverage (I think they had a $2K daily loss limit) using my own retail discount broker which offers $500 intraday margin.

The one advantage was that I could hold overnight through the electronic close with more contracts than possible with my current account would allow, but that’s not really a concern for me as I’m generally flat by the electronic close.

However, maybe if I put up capital with such a firm and traded well, they would eventually stake me and give me a more profitable deal?

I really want to make this work out, so I do need to make sure I explore these opportunities for sure.

Thanks again.

Johnny

TBH I can't find it now but I just googled 'proprietary trading firms' then clicked through the first few lists. Some of them only trade internal money of course so you'll have to select out those.

You could make a few enquiries but definitely agree that one thing you need to consider is the monthly/absolute loss limit (in $000). Someone putting up a notional $400k with a loss limit of $40k would 4x your capital. But the second thing is the profit split on the gains, and when these are paid - for example, if they offered you a loss limit of $40k if you put up $10k alongside them (not first loss, rather losses split 4:1), and offered you a 60/40 split on the annual profits (maybe with a few $k monthly draw to cover your costs), maybe that could be attractive?

Otherwise, I would just concentrate on putting together that track record. September looked good.

 

[james57]

Hello all.

Does any serious funding opportunities exist today for real traders?

Pay to trade in simulator companies are not what I have in mind.

Thank you.

Johnny

Yes.. wefundtraders.co.uk & surgetrader.com

 

[JohnnyForex]

Yes.. wefundtraders.co.uk & surgetrader.com

That's disrespectful. Maybe you're working for them.

I asked for a serious alternative. What you're linking to is just another pay-to-trade-in-simulator program. They're not funding traders.

 

[JohnnyForex]

TBH I can't find it now but I just googled 'proprietary trading firms' then clicked through the first few lists. Some of them only trade internal money of course so you'll have to select out those.

You could make a few enquiries but definitely agree that one thing you need to consider is the monthly/absolute loss limit (in $000). Someone putting up a notional $400k with a loss limit of $40k would 4x your capital. But the second thing is the profit split on the gains, and when these are paid - for example, if they offered you a loss limit of $40k if you put up $10k alongside them (not first loss, rather losses split 4:1), and offered you a 60/40 split on the annual profits (maybe with a few $k monthly draw to cover your costs), maybe that could be attractive?

Otherwise, I would just concentrate on putting together that track record. September looked good.

Got it. And thank you.

What you're suggesting there might be a worthwhile deal, yes.

I suppose for now I will just continue focusing on my trading and see how that goes. There's a genuine chance I might be quitting my job and be out of the job market for a few months in February 2023, so I might be taking another shot at full-time trading, although realistically it's a bit pre-mature money wise.

 

[Parky]

With regards to P&L splits you should look carefully at the alternatives, assuming you are self funding. If the clearing entity you are looking at is not taking any market risk then they should not expect a share in the P&L. How then do such companies make money? Simple clearing commission and a returning element, interest on your cash. If your risk profile is mostly day trading with small overnight positions and you are totally funding your margins and risk profile then you can get deals where you keep 80% or indeed all your profit.

 

[JohnnyForex]

With regards to P&L splits you should look carefully at the alternatives, assuming you are self funding. If the clearing entity you are looking at is not taking any market risk then they should not expect a share in the P&L. How then do such companies make money? Simple clearing commission and a returning element, interest on your cash. If your risk profile is mostly day trading with small overnight positions and you are totally funding your margins and risk profile then you can get deals where you keep 80% or indeed all your profit.

Thank you, Parky.

Do you have link to any such firms to consider?

Thanks.