A friend of mine was interested in starting an account with a prop firm called Tradenet which supposedly use a firm called TEFS. Does anyone know of or have any experience with Tradenet and especially TEFS?
Here are a few things that people should be warned about Tradenet. No wonder why the SEC just charged them:https://www.sec.gov/news/press-release/2020-267#.X5he1BQNBTs.twitter 1. If you blow your account, you will be blocked from the platform and the site. You cannot even look at the trades. In my opinion they do this to prevent you from getting information about their sketchy commission system. You’ll get a “user blocked” message like this http://bit.ly/3vg8KWN. Here is a video about it http://bit.ly/3ldT1Tj. 2. They give you 100% FALSE information about fees. Here is what they state regarding fees: “Trading Expenses and Limits:The current fees in a TEFS Account are $0.006 per share/CFD ($6 per 1,000 shares/CFD) with a minimum of$1.5 per ticket (additional overnight margin and routing fee of $0.0015 apply) (the “Trading Fees”). SuchTrading Fees are determined at the sole discretion of the provider of the technology that powers the TEFSAccounts and is not determined by TEFS. Trading Fees are incurred by Providers in order to reflect the manner in which orders are executed in the equity market (with market access). For the avoidance of doubt, theProvider does not and may not pay the Trading Fees by providing any type of payment to TEFS, but rather theProfits, if any, are reduced by the Trading Fees with respect to the respective Trading Account” How do we interpret this? We relate to industry standards. Fees to open a position and free to close, in other words round-trip. This means buying lots of shares and selling lots of shares will generate a $1.5 fee, no matter how you build up and unwrap the position, as long as it is the same ticker (ticket) correct? This is how every other serious broker works: Tastyworks, Interactive brokers, Tradezero, etc.. Well, you are far from the truth. First, any person reading this will understand that the fee is ONLY ONCE PER SHARE PER TICKER – not multiplied by the number of orders. It would be correct to say, minimum $1.5 per ticket per order whether to open or to close a position. They don’t do the effort of laying it down for you because making it purposely misleading. The fees aren’t per ticker. In fact, what they call ticket, is not the SYMBOL TICKER, it is the ORDER TICKET. Small difference. This means you will be charged for every hit in the mouse with an order. While this blog demystifies how this works, the information you receive to join the program is completely false. Let’s take a closer look. The current fees in a TEFS Account are $0.006 per share/CFD ($6 per 1,000 shares/CFD) with a minimum of$1.5 per ticket. This is false. First, the minimum of $1.5 is NOT per ticket. It is per order. So, in fact, the minimum fees per ticket are $3. Profits are only realized after closing a position. Therefore the minimum fees PER TICKER are $3, and this is multiplied by the number of orders TICKET clearly is confused with the symbol name, but not the interpretation they give it, not that they clarify anywhere by written either. Moreover, the term TICKET is only used un futures! https://www.investopedia.com/terms/d/deal_ticket.asp Now, what happens in real life. Professional traders enter a position on a breakout, then add at the next consolidation point, then scale a first lot on the next consolidation point, then some more, until the position is fully unveiled. What does this mean? If you have a $14.000 account with a max loss of $700, say your risk unit is a 20th of that, so $35 max risk per position. Let’s mimic an operation from a professional trader from say SMBU. If you trade a $50 stock with a stop loss of $1 and an expected move of $2, you can only trade 35 shares to fit your maximum risk. Say you enter with 10 shares, then you like it and add 10 more. Finally you add the remaining 5. You close 10 at half the move. You close 5 stocks one by one more somewhere else. Then break even on the rest. What would be the fees generated? The fees you think: $1.5 for the whole operation. It is ONE SYMBOL (ticket or ticker), SAME SHARES YOU OPENED, SAME SHARES YOU CLOSE. Therefore, $1.5 which is the minimum. The fees they really charge: Orders (what they willfully call it ticket when everyone calls it orders): 1. Open 10 stocks 2. Open 10 stocks 3. Open 5 stocks 4. Close 10 stocks 5. Close 1 stock 6. Close 1 stock 7. Close 1 stock 8. Close 1 stock 9. Close 1 stock 10. Close 10 stocks The fees they charge for this operation: 10 x $1.5 = $15. You winnings, somewhere around $15. Your fees, $15. As a result, you end up net 0 in a successful operation on a $14K account. 3. Which is worse. *you don't find out about fees until the next day!*. In my case, I ended the day with a net loss of $30 which is less than a risk unit. However, the next day I was charged $234 in "undisclosed" fees. That unpleasant surprise automatically made me try to revenge trade losing some more. When you complain about having been given misleading information about fees, they will insult you and lie saying that they explained it fully. If that were the case, why is it not published in written form in a clear manner like every other broker does? Think about it. 4. YOU LOSE. By the time your account starts to drain, it is by fees, and before you realize the account is closed. Only you lose. This is true at least with the 14K account. 5. APPLYING TO THE WARRANTY MEANS INSULTS AND BEING BANNED. Even when they made the money from you off fees, they will still insult and yell at you on the phone, literally, alleging that you have “ABUSED” the account. If you complain about this or ask for a refund, they will insult you and treat you like unworthy, literally. They will let you know that you have been banned from Tradenet services in the future once and forever. They do this with a demeaning and cocky attitude. They state false allegations such as that you failed to do this or that but it is nonsense 6. THEY WILL TALK YOU DOWN. If you are a seasoned trader and bring up your techniques in the trading room, you will be stigmatized. You are not there to think. You can’t shine. You are there to follow and continue to support the magnificent image built around Meir Barak. I was talked down by Mair. He told me in the trading room WHAT ARE YOU DOING HERE! because I used a trailing stop. This is in no way a healthy environment. 7. For all I know the 14K account program could initially be a paper account in a Ponzi scheme. There is no even record of your own trades or the fees charged on your account before they kick you out. 8. Censorship through all social media. Have you ever seen people losing money? Isn’t it weird? They are banned from the channels. Professional traders are transparent. While they speak of transparency, they fail to give a voice to those customers they mistreated or misled with their sketchy operation. 9. The referral program. Needless to say, pyramidal "networking business" programs are ponzi-like. I base my statements on the fact that the fee schedule isn’t clear nor public. 10. The challenge and demo accounts do not work because they do not account for the fees they withdraw overnight from your account. I cannot recommend Tradenet at all. If they can’t make clear the fees, what else are they hiding?