Thursday, July 31, 2008

Proprietary Trading Firms Offering Training

As I mentioned in my recent post on training successful traders, a number of proprietary trading firms that train their traders are rolling out their training programs as stand-alone offerings for independent traders. This is a promising development and a potential win-win situation: it offers real-time education for traders from mentors who actually trade for a living, and it leverages the activities of the prop firm into a separate profit center. It also potentially creates a path by which independent traders could prove themselves and eventually trade prop capital.

In addition to SMB Capital, mentioned in the original post, here are two more firms actively participating in the training space:

T3 Live - I'm very impressed with the use of technology to create a virtual trading floor, in which traders can watch prop traders live. Among the features offered by T3 Live are a radio/squawk box to hear traders call out their ideas; live video broadcasts; training videos; and daily analyses of markets.

TCA Markets - This UK firm operates on a unique model. They offer training for traders on a remote basis, with the understanding that graduates of the training can qualify to trade the firm's prop capital. They also offer salaried positions to selected graduates.

I cannot stress enough the importance of due diligence. These programs are not inexpensive, and it is important that they offer the specific kinds of training that a trader most wants and needs. I strongly recommend that you talk with graduates, review details of the curriculum, and make sure that what the firm is offering truly meshes with your particular interests and strengths. While promising, this field is also ripe for abuse, much as so-called modeling schools promise grand agency contracts to graduates, only to leave them high and dry after taking their tuitions.

Disclosure and Caveat: I do not work for any of these firms, do not receive any compensation or consideration for mentioning them, and have not been solicited for mentions by them. My goal is to highlight possible opportunities out there in the trading community; it's up to you to engage in the due diligence and ensure that these truly represent opportunities for you.
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11 comments:

b.healed said...

I am looking into TCA markets right now. What kinds of questions would you recomend that I ask them to insure that they are quality? thanx

Brett Steenbarger, Ph.D. said...

Hi B Healed,

I would get nitty gritty details on the specific skills and trading approaches they teach, and I would talk to a range of graduates from their program. That should provide worthwhile perspective--

Brett

Golden Panda Ad Builder said...

Can someone help me with the best Proprietary Firm to join?

I doesn't have to be remote I will move.

Thanks,
Chad Smith
Atlanta GA

GentlePEACE said...

I have been approached by TCA Markets, and next week I would be visiting their office in London. They provide 4 months training, and the cost is borne by the trainee. It comes to 3000 UK Pounds or 80 pounds on a monthly basis. Please let me know if this is normal in getting to becoming a trader?? I am a fulltime Financial Advisor working in London.
PLEASE ADVICE.

GentlePEACE said...

Hi, I am looking into various options of getting into a good prop tradng firm but my research has shown that there are a number of trading platforms like Financial Futures, Options, Fixed Income, Equity Options etc etc. For a newbie like me, which should one go for. Please advice.

Brett Steenbarger, Ph.D. said...

Hi Gentle Peace,

You can find some feedback on prop firms on some of the forums for traders such as Trade2Win and Elite Trader. My general advice is to talk with many traders at the firms and get a sense for their satisfaction and success.

Brett

GentlePEACE said...

Shouldn't a tarding company like TCA be registered with the FSA. I couldn't find the company pofile at the FSA Register, why so? Thanks.

Brett Steenbarger, Ph.D. said...

Hi Gentle Peace,

I'm not familiar enough with FSA regs to answer this; maybe a reader knows. Best to check with the firm and/or FSA itself. I continue to stress due diligence and talking with many traders at a firm to get a sense for the firm's turnover and success rates. The model in which people pay for education with a promise of eventually trading prop capital may be implemented ethically, but is tailor-made for abuse and misrepresentation.

Brett

GentlePEACE said...

I have been doing a lot of research on Trading before taking the 'leap', and I have read this at so many places that "90% of traders FAIL". I have no idea about trading but I have never 'failed' at anything I have done so far, so howcome, trading can be so difficult???? Why is it so 'impossible' to achieve success at trading? I presume there is a process in place, a research, a strategy to do trading OR is it all LUCK? If it is all luck and nothing is in your hands, then ya, why won't 90% fail. Any coments would be most welcome. Thanks

L_Duble_E_one_2 said...

trading is not always about making the best trades or luck alot of it comes down to controlling your emotions and sicipline, one thing with alot of traders that i have found in the forex market inparticular is people let their emotions get in the way, they let losing trades run hoping they will turn around because they dont like the thought of taking a loss yet they often close winning trades early for small profits for fear of it turning into a losing trade, so big losses and small profit equals long term losses for 90% of traders, hope this helped :)

arustmoh said...

gentlepeace.. u said u never failed in anything ... that is why pplz fail. they think trading is just like routine job u work and get paid... in trading it doesnt work that way. sometimes u lose and sometimes u win.. it is soo easy to make money in trading. and it is easier to lose it all in one day and less than one hour!. even the best traders lose money.. the key point in trading is survive the market even if u r wrong about the market, u have to put a strategy that let u survive the market! thats wht profisionals do!