I have traded for myself for the past 2-3 years now. mainly trading equity derivatives (calls and puts) and playing with implied volatility to get in and out of derivatives. my question to all is I have recently moved to New York and was interested in trading with leverage in a professional place. I went on an interview with WTS Prop Group last week and have been invited to their Training Program. 1.) What are peoples' experience with WTS? 2.) What do these people make monthly/annually, how are they paid out? 3.) What is the 1500 deposit used for? 4.) What do they actually teach you in the training course 5.) What happens if you lose money? Make money? 6.) What type of leverage are we looking at here, and what do these people usually make? 7.) What is in it for these prop firms, what advantages do they have that retail people dont? Please answer one, all or shed some light. I am not new to trading, just new to the prop game.
im new to the prop thing too and have also been trading options prior to this. i just hooked up with a branch of wts and will see how it goes. as far as i can tell at this branch there is no real training. You just start with small trading size and ask the guys that have been there a while for assistance as needed. The 1500 is put in your account so if you loose money it comes out of your pockets not theirs. seems like crummy deal at first but i think if you can pick it up and start making money they will up your trading limit and it could be profitable. let me know what its like where your at.
This is not particular to WTS. I could be wrong in terms of their programs, however, I answered this to the best of my knowledge working with MANY firms over MANY years. 1.) What are peoples' experience with WTS? WTS has been around a while. They're registered with CBOE. they have a pretty good reputation. Their services are more geared for pros. You won't find good entry-level training here and don't expect $1500 to teach you this business. It takes a lot of time, hard-work, dedication, and $$$$. 2.) What do these people make monthly/annually, how are they paid out? Prop traders are paid a profit split. This can be anywhere from 50/50 to 99/1 depending on which side of the deal is taking more risk (usually both the trader and the firm are exposed to some risk) 3.) What is the 1500 deposit used for? they use this to cover any loses. You can't expect someone to train you and take risk on your trades. If someone agrees to that, they are a real sucker or doing something very shady. 4.) What do they actually teach you in the training course probably a few different strategies and how their ECN/routing system can be used (the main benefit over retail trading) 5.) What happens if you lose money? Make money? lose money, quit or work hard and invest more capital. Make money, you'll have a track record that will get you a fully-backed deal, maybe even with a salary if you have a few years of documents proving this (your trade reports) 6.) What type of leverage are we looking at here, and what do these people usually make? The firm makes commission off your trades and any profit split you have in place. They probably have a deal where they pay around $.50-$2.00 per thousand shares and the markup is the difference of what you pay. That and any training fees that are not equity in your account. 7.) What is in it for these prop firms, what advantages do they have that retail people don't? The advantages are leverage & access to large amounts of firm capital. They also have many routes to get orders filled which is not available to retail. These routes allow you to reduce commissions or collect rebates and/or get orders filled very quickly. Placing an execution on a web platform requires the order to hit the application's server and then get routed our for purchase. This difference may seem minimal, but it makes a difference when trading volume. There are firms out there that don't charge for training, but they do require a capital deposit. The benefit to a "deposit" over a "training fee" is that you should be able to take your deposit back if not happy if you are with a firm with no lockup fee.
When I first got interested in trading, I would read all the threads here on prop firms and how horrible they are because of the deposits and capital needed. As I learned more and more about this business, I've realized all these people are just complainers who want everything handed to them easily. These kind of people who think that most prop firms are scams are the same people who say that poker is not beatable and it is all luck. Anyone with any intelligence knows that poker is actually a game of skill. Anyone who thinks that a firm will just risk 100% capital on someone who has never traded in their life is ridiculous. I would bet that 90% of the posters on here don't even trade.
I agree with the last post. I takes understanding and skill like poker. I play poker a lot actually and played a WSOP event in 2009. I agree that its the same people that think poker is all luck that think trading is all luck. Its a matter of getting an edge and putting the probabilities in your favor.
You summed it up pretty well. The only important things (in this order) are 1) Who are you dealing with? (ie do they have a good reputation) and 2) What deal can you negotiate? (lowest deposit / highest payout WITHOUT jeopardizing the first point).