What are my Options for Getting Funds to trade/getting funded?

[BizTechTrader]

I have 10 years experience trading for myself - most of which while holding other jobs or in school. For most of this time I was breaking even after commissions. Awhile ago I calculated my lifetime commissions to be somewhere in the range of $5,000 - $7,000, but they are probably $1,000 more than that now. Total funds deposited in my account since my lifetime is $7,000, but I have withdrawn considerably more than that in the last 2 years to pay for living and emergency expenses. I have finally gotten to a point where I feel confident in my abilities to be consistently profitable. I don't have much saved up, but what little I have I have been doing well on - this year especially. It is not enough for me to live on and devote myself full time to (which I would like to do). My stats, 2011 ytd:

2:1 winning ratio
1.29 profit/loss ratio
Avg. holding time: 17 (market) days

Do I have any options for getting funded from outside sources with or without a series 7 or others series tests? I would really love to be making other people money, especially in these markets. As a side note I have 2/3rds of my CMT designation...

If it is impossible for me to get funding what other options do I have? Since I graduated college I haven't been able to find work at a financial firm, and I hate to see my skills go to waste in accounting.

 

[tommog]

Your best bet is to join a prop firm, they will back you. A young guy with good education that has shown the ability to not lose money on a private account should get a few people interested. However, they almost certainly wont let you hold trades overnight to start, it would mean scalping, but if you can do ok on longer term time frames you probably have the skills in your locker to crack the intraday stuff too if you are in a good environment.

I see you are from the states, most of the guys on this forum are based in the UK (including myself) so couldnt really help you out in terms of companies to approach as I dont know the US prop firm industry but sure Google can help.

As for raising finance to form your own fund, trust me, unless its just family and friends money (which i wouldnt advise) it is an absolute nightmare to go that route, and would need several million as seed money to get you going. Generally fund managers would take 20% of profits, so unless you are making 100% returns even a million dollars wouldnt really make it worth your while after all the legal/software/general business expenses you would need to take care of.

 

[BizTechTrader]

@tommog - Thank you for your kind response. I was finding it hard to believe that no one could care/benefit, as I am personally very pleased with my results in 2010 and 2011 - almost too good to believe really (in my mind). I was wondering if they were even that good at all or if I was just crazy. It seems in general the ability to invest profitably is undervalued or not even considered a skill at all... of course I have no real experience apart from an internship at a brokerage, so who am I to ask for $? Anyways, THANK YOU again, it means a lot to me to have optimism to leave my part-time jobs that I have no long-term interest in and find something to which I know I am suited.

 

[Nexas]

Hi,

There are actually quite a few firms out there that will fund you. There are even some that will allow you to trade from the comfort of your own home.

Where do you live?

Nexas

 

[BizTechTrader]

Hi Nexas,

I really don't find day trading appealing at all. In my mind it is more risky than holding positions overnight because we all know how much noise there is trends, and how big day trading positions need to be in order just to secure a small cut. Why not just take an intermediate-term position with much less capital? (Your overall risk is lower since you're investing less.) Since price is a function of time, it stands to reason that this method is more profitable, since you can not only capture intraday movements, but overnight movements as well. Granted, this is where the risk comes in, large gap-downs or potentially even bankruptcies overnight. But if you are consistently able to profit, you should be fine. As long as you give yourself a large enough sample size/# of trades to work with, it will be very profitable... just spread your eggs around. In my mind it also iinvolves less psychological risk as well.

I mention this because I was recruited by a prop firm and offered a position, IF I paid them $7,500 for their training program, that is. I am not in the market to pay someone for my skills, I am in the market to make money just like anyone else. They were a daytrading firm in NYC. As I said I am not very interested in day trading... my knowledge is geared to trades of a week to maybe four weeks at the most. I also have no interest in trading from home. I like to be surrounded by other hard-working individuals in my work environment.

I am more interested in either providing analysis for timing trades, proprietary swing trading for a bank/shop, or executing planned trades on behalf of a firm.

And I live in Los Angeles. I applied to most of the prop firms around here unsuccessfully... no response... not even from the unpaid ones!

 

[LuKOs.ro]

Hi BizTechTrader,

I don't know if this helps you a lot, as it is from 2007 (and some of them may not exist anymore), but here is a list of prop trading desks for you to contact. I cannot recommend any of them as I had no personal contact with neither one.

http://www.tradersnarrative.com/list-of-proprietary-trading-firms-735.

As an alternative you can also try all the major investment banks: UBS, Deutsche Bank, Barclays Capital, Credit Suisse, Societe Generale, Nomura, JP Morgan, Goldman Sachs, Citi, Morgan Stanley, etc.

Good luck!

 

[BizTechTrader]

@LuKOs.ro Thank you for the kind lists and for your optimism-inspiring response =)

 

[LuKOs.ro]

Sorry mate, I forgot to post the .html part .

http://www.tradersnarrative.com/list-of-proprietary-trading-firms-735.html

Thanks for reminding me.