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Anyone trading with a Prop firm 1 reply

prop firm new model - my trading journey 869 replies

So I accepted a Prop Trading job in South Beach Miami 43 replies

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Quoting pipmaster77
Wow, the recent posts sure seem to express a lot of underlying jealousy regarding those of us succeeding with prop firms. MFF essentially gives you 8 weeks to make 8% if you use the extension. It's really not that crazy a target. They also pay 2% on phase 1 profit and 4% on phase 2 and refund the initial fee with first split. Then they pay biweekly, 75% 1st month, 80% 2nd and 85% third. 100:1 leverage, 12% max DD. What is it you guys need beyond this? Is it just to come on here and bitch about how horrible prop firms are? Yes, 90-95% fail, right...
Hey Pip

Well not from me, I’m 6 months in with MFF and have no real complaints.

However the stretch targets are only there to trip up traders and churn entry fees. Having to roll the dice on a few occasions to get % in the eval/challenge phases just sets you on the back foot, either by blowing it or encouraging gambling to get a short term gain.

So is it really in their interest to risk a lucky few gambling on 200k accounts for a single 5 figure payout never to be seen again until they’ve done the same at the next firm?

Or (shock/horror) would they be better off awarding funds to a trader 5 months profitable out of 6? The serious folks would still be chipping away while the ea cowboys would be clogging up the online support of another company….

But cash flow is king and it comes from the failed accounts (at least I think this is the business model) so let’s hope it’s sustainable because I’m enjoying getting paid to trade!
Quoting pipmaster77
Wow, the recent posts sure seem to express a lot of underlying jealousy regarding those of us succeeding with prop firms. MFF essentially gives you 8 weeks to make 8% if you use the extension. It's really not that crazy a target. They also pay 2% on phase 1 profit and 4% on phase 2 and refund the initial fee with first split. Then they pay biweekly, 75% 1st month, 80% 2nd and 85% third. 100:1 leverage, 12% max DD. What is it you guys need beyond this? Is it just to come on here and bitch about how horrible prop firms are? Yes, 90-95% fail, right...
Other traders have issues that come here to talk about and find solutions. You are not offering any solutions. All you are saying is that no one should have any issues to talk about and all is good as it is. Really useless advice if we can call it that. Okay, you have said many many times that you like it the way it is. Well understood. Now, if you don't mind, step aside and let those with issues and those with possible ideas discuss things. Thank you.
Quoting OutThere
{quote} Other traders have issues that come here to talk about and find solutions. You are not offering any solutions. All you are saying is that no one should have any issues to talk about and all is good as it is. Really useless advice if we can call it that. Okay, you have said many many times that you like it the way it is. Well understood. Now, if you don't mind, step aside and let those with issues and those with possible ideas discuss things. Thank you.
You are so bitter on every topic. What are the issues? If you are looking for some company to just hand you 200K to trade with no rules, it doesn't exist. Issue solved.
Quoting Fagin
{quote} Hey Pip Well not from me, I’m 6 months in with MFF and have no real complaints. However the stretch targets are only there to trip up traders and churn entry fees. Having to roll the dice on a few occasions to get % in the eval/challenge phases just sets you on the back foot, either by blowing it or encouraging gambling to get a short term gain. So is it really in their interest to risk a lucky few gambling on 200k accounts for a single 5 figure payout never to be seen again until they’ve done the same at the next firm? Or (shock/horror)...
Absolutely, failed challenges are definitely part of the revenue stream. They have openly admitted it. I also believe trades (not all) go to market as well. There the revenue more than likely comes from a combination of volume rebates from LPs and actually profit sharing with the consistently winning traders.
My entire point when speaking on these firms (FROM REAL EXPERIENCE)....the ones offering no time limit charge you a fee equal to or more than the DD they allow, you simply fund your own account and give up 35-50%. With MFF and FTMO, with free retakes and extensions, the target is not as crazy as some make it seem. 1-1.5% per week can be attained without taking on much risk at all. Plus, the DD they allow is 2.5-3 x what the "no time to pass" companies offer.
Quoting pipmaster77
{quote} You are so bitter on every topic. What are the issues? If you are looking for some company to just hand you 200K to trade with no rules, it doesn't exist. Issue solved.
Thank you representative of some prop firm.
If I wanted to here "We do whatever we want", I would just take my number 373 on the que list and wait for a JD type (John Doe) to deliver me that news but I know you got a rubber stamp made with your usuall "I am so happy, I can hardly contain myself" response and want to bang on the forum because it makes you feel good. Glad to have such none bitter responses from you but if they are not bitter, they don't have any flavor either. Just blend and boring.
Quoting pipmaster77
{quote} Absolutely, failed challenges are definitely part of the revenue stream. They have openly admitted it. I also believe trades (not all) go to market as well. There the revenue more than likely comes from a combination of volume rebates from LPs and actually profit sharing with the consistently winning traders. My entire point when speaking on these firms (FROM REAL EXPERIENCE)....the ones offering no time limit charge you a fee equal to or more than the DD they allow, you simply fund your own account and give up 35-50%. With MFF and FTMO,...
Like you I’m interested in watching the evolution of MFF and FTMO. Watching how the latter is now reacting to real competition is also encouraging, if they both manage to survive and thrive long term it can only mean good things for serious traders.

I fully agree with you about about equal DD being a con, we know we can simply discount these bucket shops but I do hope in the future that FTMO and MFF will be solvent enough to start any aspiring pro trader off on the right foundations not by lowering the bar but making the 1st stages more realistic to what a trader should be doing month in and month out. I can only see measuring consistently good performance as a fair route to entry (if they want real traders that is).

I think that’s a way off yet though….
In truth, it would not be very favorable to these firms, and to most traders, to offer a more realistic challenge. Not only would that likely reduce their overall profit-potential, but it would require traders to wait even longer for their live accounts.

It is a very good business model. They can essentially have signal providers coming to them. Not only that, but the signal providers must pay them in order to prove themselves, allowing these firms to automatically weed out the losers while only accepting the best signal providers, all while making a ton of profit out of nothing in the process.
its a interesting way for traders to build an account if they have constant winners using someone's else money to allow bigger trades i can see the value in that and the split seem fair , i think the only problem is not being able to hold over the weekend with a positive swap like i have with xti , i dont know if that as changed , and in my books what the prop firm takes in profits means nothing , its what the trader get out of, it is the important side of it , just my thoughts on a important subject
I LEARNT HOW TO TRADE
  • Post #6,389
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  • Edited Jan 22, 2022 11:23am Jan 21, 2022 6:58pm | Edited Jan 22, 2022 11:23am
Just to confirm from my end, im happy with the rules, they are what they are and I will keep plodding away trying to pass them no matter what the conditions are.

I was just curious to know what there thinking is when they come up with the rules. Obviously they are constructed in such a way to filter out losing traders which i totally understand, but i was curious to know if they are also constructed to filter out some profitable traders as well to keep a limit on some of the live accounts.

What got me thinking of this was....the other day i was browsing through some trading stuff on youtube and saw some of Tom Dantes stuff. Mixed into the videos he talks about some of his experiences of working alongside prop traders (actual desk prop firms), he says some have winrates of 60% with 1R targets (sorry in advance if ive misheard or got this wrong, just going off what i can remember) and those guys are employed by actual prop firms, he says sometimes these prop traders can have losing months or even quarters. My nievety assumed that proffesional traders had much better results than this, so that was an eyeopener. I would guess that these guys would be classed as "good traders" purely because they are employed at professional prop firms.

Ive heavily digressed here , but would these guys with such trading records pass evaluations based on the fact they have losing quarters. Or maybe prop firms like mff/ftmo etc are looking for the elite of the elite, based on the fact that only 8 traders made it to there 4th payout with mff (if i remember correctly).

Anyway guys you gave me some good answers to my question earlier
Anyone tried to join to smb cap? They're sending many emails about hiring recently..
Quoting Paulscaff1
Just to confirm from my end, im happy with the rules, they are what they are and I will keep plodding away trying to pass them no matter what the conditions are. I was just curious to know what there thinking is when the come up with the rules. Obviously they are constructed in such a way to filter out losing traders which i totally understand, but i was curious to know if they are also constructed to filter out some profitable traders as well to keep a limit on some of the live accounts. What got me thinking of this was....the other day i was browsing...
I know what you’re referring to with Dante’s video. He was influential with me getting on the right side of trading psychology.

I also know a bit about the firm he was at. It was popular at the time and spun off several trading legends, like Navinder Sarao.

During the “Edges for Ledges” live sessions some years back, he discussed often about his time in prop.

The natural progression was good traders would eventually leave the firm, as the splits were no longer attractive. If you were having a bad week or month, then you would get knee capped on your account size until you got back on track. If you couldn’t then your spot was filled with another person and you were shown the door.
Trade with confidence, trade without fear.
Quoting Paulscaff1
{quote} Yeah I get the MFF extension, and will likely end up relying on it myself this month. Ive only just learned about the ftmo one from your post, though so that sounds pretty descent. I was kind of meaning from the prop firms point of view. How their thinking works while deciding rules. For example, playing devils advocate....if I was starting a prop firm (which im not ) and i put forth the idea to my business associates that I like the idea of a 60 day rule, because we often hear of some of the best traders having losing months (and also...
1 week is too short a testing period in anyone's book.

Quarterly to half yearly to yearly is too long a testing period as far as a Prop Firm is concerned considering that they would consider this period less enticing to attracting more entry traders.

So they choose 30 days because it's a nice mid term type trading period that they know the bulk of traders will be ok accepting.

Then they add in a few more carrots for the lucky or gambler types such as 5 or 10 minimum days to hit the targets coz gamblers are always happy to have an opportunity to satisfy trading conditions in the shortest time possible.

Then they add in some time extensions for the typically more risk averse type trader in the hope of cornering that part of the market.

And on and on it goes with the addition of more and more dangling carrots in front of new traders to gain an ongoing challenge fee generating machine.

A model better suited to the very best of traders would be to have a minimum of a quarter testing period and an allowance up to one full year to meet realistic Prop Firm targets for example:

1. Returns in line with major trading houses or Hedge funds (in terms of average yearly returns);

2. Drawdown (both in terms of minimum account equity and peak to trough);

3. Target Returns greater than the yearly SP500 (~10% pa on average)

It's easy to find listed Hedge Fund returns YoY but the actual DD used to achieve these results can be a little more trickier.

Once you have an average YoY return for example 30% then go about breaking this down into a compounded monthly return which is a little over 2.2%.

Now these Hedge Fund returns will vary year to year but the point here is that there is a team of highly trained professionals with some state of the art technology gaining on average a little over 2% per month.

Back to the Retail Prop Firm space we find targets of about 8% to 10% over a month so almost 5 times the gain of our Hedge Fund friends.

Of course both sides are dealing with very different leverages and trading rules which in some respects gives some advantage to the retail challenge taker but is performing about 4 to 5 times greater than a Hedge Fund realistic ?

Perhaps not but at least it only has to be completed once per challenge.

Which reminds me that my next challenge will be undertaken very soon ... and yes it will require some luck or rather good fortune to hit the target.

Masterrmind .........
Master your Mind then Master your Trades
Quoting Masterrmind
{quote} 1 week is too short a testing period in anyone's book. Quarterly to half yearly to yearly is too long a testing period as far as a Prop Firm is concerned considering that they would consider this period less enticing to attracting more entry traders. So they choose 30 days because it's a nice mid term type trading period that they know the bulk of traders will be ok accepting. Then they add in a few more carrots for the lucky or gambler types such as 5 or 10 minimum days to hit the targets coz gamblers are always happy to have an opportunity...
Nice explanation mate

And.......good fortune!
Quoting Paulscaff1
{quote} Nice explanation mate And.......good fortune!
Thanks Paulscaff1.

TE will be visible here if MT4 is used otherwise a link to a non TE supported trading platform will be provided.

$200K.

Early February at this stage.

Masterrmind ........
Master your Mind then Master your Trades
Quoting pipmaster77
Wow, the recent posts sure seem to express a lot of underlying jealousy regarding those of us succeeding with prop firms. MFF essentially gives you 8 weeks to make 8% if you use the extension. It's really not that crazy a target. They also pay 2% on phase 1 profit and 4% on phase 2 and refund the initial fee with first split. Then they pay biweekly, 75% 1st month, 80% 2nd and 85% third. 100:1 leverage, 12% max DD. What is it you guys need beyond this? Is it just to come on here and bitch about how horrible prop firms are? Yes, 90-95% fail, right...
Great post pipmaster77.

Often the obvious is never seen.

Traders can always test the waters in a Prop Firm by starting with the lowest entry program (to minimise magnitude of potential fee loss) and find out what the whole process is actually like from start to finish, then consider ramping it up with more expensive challenges if the conditions suit them.

Then decide if maxing out funding with a particular Prop Firm is a good idea.

Some risk has to be taken on the part of the trader in order for the possibility of riches to occur.

Otherwise, it's simply a case of remaining an average Joe.

If average Joe status is what they want then all well and good but they need to stop posting unfounded dribble otherwise out will come the 'I' hammer.

Best of trading,

Masterrmind ........
Master your Mind then Master your Trades
There will always be critics and negative nellies. It does not matter what you do or how well you do it.
Quoting Paulscaff1
Just to confirm from my end, im happy with the rules, they are what they are and I will keep plodding away trying to pass them no matter what the conditions are. I was just curious to know what there thinking is when they come up with the rules. Obviously they are constructed in such a way to filter out losing traders which i totally understand, but i was curious to know if they are also constructed to filter out some profitable traders as well to keep a limit on some of the live accounts. What got me thinking of this was....the other day i was...
There was another distinction with that prop firm Dante was at. They didn’t hire just anyone of the street. You had to show some profitable track record to get in the door.

That’s a big difference to what we see here with these virtual firms. It’s open to anyone for a fee, regardless of their experience.

My view is regardless if it’s a prop firm or one’s own account. The road to successful trading is paved with blown accounts. The journey is a money pit. Most will learn nothing on the journey and wash out, a select few will perceiver over the long haul.
Trade with confidence, trade without fear.
Quoting Cryptosurf
{quote} There was another distinction with that prop firm Dante was at. They didn’t hire just anyone of the street. You had to show some profitable track record to get in the door. That’s a big difference to what we see here with these virtual firms. It’s open to anyone for a fee, regardless of their experience.
Yeah that was my assumption with the real prop firms, that you would have to have some sort of record and possibly even formal qualifications.

Kind of ironic though, that they have spent all that time building their track records, maybe spent years trying to achieve formal qualifications, to then go and work for "the man" (real prop firm), someone breathing down their neck and putting pressure on them to hit targets etc.

I bet as soon as FTMO and MFF came on the scene thousands of them all told their bosses to ram their jobs and are now working for themselves, from their own house and setting their own targets, and living the lives they have always dreamed of with virtual prop firms........but wait, that cant be true because only a handfull of traders have made it to 4 months of payouts with MFF? Surely it should be so much more than this if loads of the professional prop traders jumped ship to virtual firms.

Am I missing something here?
Quoting Paulscaff1
{quote} Yeah that was my assumption with the real prop firms, that you would have to have some sort of record and possibly even formal qualifications.
Not sure if that's mandatory by law but a lot of prop firms demand traders' approval on SIE and Series 57 exams.
Quoting pipmaster77
Wow, the recent posts sure seem to express a lot of underlying jealousy regarding those of us succeeding with prop firms. MFF essentially gives you 8 weeks to make 8% if you use the extension. It's really not that crazy a target. They also pay 2% on phase 1 profit and 4% on phase 2 and refund the initial fee with first split. Then they pay biweekly, 75% 1st month, 80% 2nd and 85% third. 100:1 leverage, 12% max DD. What is it you guys need beyond this? Is it just to come on here and bitch about how horrible prop firms are? Yes, 90-95% fail, right...
Such a rosey description of the road map to becoming the hot shot prop trader that everyone dreams of.
You are someone that makes 52% per year consistantly (1% per week) sound like a walk in the park. All you have to do is select 8 of those successful 52 weeks and roll them into MFF program and you have it made. How much simpler do you want it folks? And oh, btw, once you do that, you get paid bi weekly. Such a bonus. Bi weekly. That tilted the scale for me.

Well Pip, I don't know how you trade. You hardly talk about methods. Maybe you do. I donno but the only trading I have seen you do is the competition thing that you and I did. Out of roughly 63 trades, you had around 3 briefly see the positive side and then bust Went the whole thing. Of course you were under the 5ers boots but 60 wrong trades out of 63? Was it their program's fault? I think you have taken leaps and bounds since then because you are now able to make 1% a week under imposed trading restrictions and making it sound like a child's play.

I think you should add something like IF YOU ARE LIKE ME AND CAN MAKE 8% IN 8 WEEKS, THEN YOU CAN ENJOY LIFE LIKE ME. And do please let us know what transformed you from account blower to prop firm dream trader.
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