NEW CTA: Discussion on Back-Office and FCM Choices

Discussion in 'Professional Trading' started by Wicked Daddy, May 1, 2018.

  1. Greetings,

    I'm new here and new to being a CTA. I have been a successful, private trader for many years - my only source of income. Many friends have repeatedly asked me to handle their money and I finally decided to take the leap. I have passed the tests, registered with the CFTC, paid my NFA dues and my DDoc is currently in review. I've checked everything off my diligence list except choosing an FCM and perhaps a back-office partner. I have clients ready to go, although I don't expect to be handling millions right out of the gate.

    I checked out CTA Services. They seem good and could probably make life easier. I would appreciate any opinions on them or others that CTA's here are using.

    I've looked at Interactive Brokers, Trade Station and Gain Capital as FCM's. Gain is the only one that provides the flexibility for clients to use the FCM/IB of their choice. Interactive seems good for a new CTA - keeps costs low and they appear to provide a decent back-office support system, possibly eliminating the need for additional support. The folks at CTA Services don't suggest them. They say it's too limiting and perceived as "amateur". I am currently with Gain for my private trading. I'm not attached to them but I don't have complaints either. Their reporting is OK but I'm not sure how it will be if/when I switch to their institutional side.

    I trade spot currencies and will continue, as well as offer currency futures now as a CTA. I'd like to keep that all in one place. Trying to choose among the FCMs I read about on this forum has become daunting. Honestly, the deeper I get into it, the more convoluted it seems.

    I'm looking for advice and some insight on the personal experience of more established CTA's as to how you launched, what worked, what you would have done differently, who you use, why, etc.

    Thanks in advance!
  2. CALLumbus


  3. Interesting and thanks.
    I'm not as concerned with their financials - they are big enough, although it's nice to know their volume, etc, for the sake of execution. I've had no problems trading FX with them and they pay the best roll-overs I have found (yet).

    At this point, it's back-end support I want. I don't want to be spending valuable trading time figuring out performance reporting, allocations and all the other NFA required trade data reporting.
  4. R1234


    RJ O'Brien
  5. I've been combing through their website prior to calling. Good for newbies?

    What about back-office?
  6. CALLumbus


    They dont offer spot currencies, I think.
  7. tommcginnis


    Where do you want to go?
    If you want to go fewer/larger, then appearing "amateurish" could bottleneck you.
    If you wanted to go more-if-lowerAUM clients, IB has a lot of ready features to assist, including a dandy whitebox/trading facet that others may not, allowing you act not only as OPM trader,but OPM trading facilitator as well -- that's a broad résumé right there.

    FWIW and all that...
    But it seems IB would allow for easier out-of-the-gate running, and no one has ruled out a change later, right?
    CALLumbus likes this.
  8. You are correct Tom. Changing later or even just adding to my toolbox is a distinct possibility. I appreciate your response!
  9. R1234


    They are good for all CTAs including new ones. You might not get the best commissions if you talk to them directly as you are still small. Go through a good introducing broker to negotiate low commissions.

    Their back office is really great for CTAs
  10. Good info. Thanks!

    This process reminds me of doing an RFP from my corporate days. Ugh!
    #10     May 2, 2018