Attracting Investor Capital | Page 2 | Forex Factory

Options

Go to
Permalinks
Print Thread

Similar Threads

The Absent Minded Investor - Adventurous Forex Trading Tales 32 replies

Investor login 1 reply

Analysis for the Longer Term Trader/Investor 1 reply

Attachments: Attracting Investor Capital
Exit Attachments

Attracting Investor Capital

  • #21
  • Mar 24, 2010 8:30pm Mar 24, 2010 8:30pm
Thanks and that I will. I'm just going to study and pass the tests while slowly and methodically building my performance record, works out perfectly!

I'll make sure to pass on any information i feel would be useful.

Erik

Quoting The Fool
Hey amigo,

I am just learning about it myself. Do your own due diligence but I think you can fly under the NFA radar if you are trading for <15 clients. <15 not enough, I'm goin nationwide.

Currently, I think you can set up "Money Manager" accounts at some brokers simply by flashing the right amount of cash. Regulations are likely to get tighter, though. When I talked to CitiFxPro rep yesterday he said they looked for a solid verifiable 2-year trading history OR registration as a CTA.

OK fine I can pass the test. I think I will do it sooner...
Annoying Precision
  • #22
  • Mar 24, 2010 8:31pm Mar 24, 2010 8:31pm
Quoting doblece
<15 clients and/or a maximum of $250000 in managed funds, whichever applies.
AFAIK.
aah..merci, CC.
"If The Fool persists in his Folly he will become wise." - William Blake
  • #23
  • Mar 24, 2010 8:39pm Mar 24, 2010 8:39pm
Quoting The Fool
aah..merci, CC.
Il n'y a pas de quoi! Avec plaisir!
  • #24
  • Mar 24, 2010 10:40pm Mar 24, 2010 10:40pm
Quoting doblece
<15 clients and/or a maximum of $250000 in managed funds, whichever applies.
AFAIK.
Seems they changed the amount, I had been previously told it was <250K.
It is in fact now 400K as maximum.

Here are the references:

CPO and CTA Exemptions and Exclusions

Electronic code of Federal Regulations

Exemption system
  • #25
  • Mar 24, 2010 10:57pm Mar 24, 2010 10:57pm
Hey doblece I'd like to thank you VERY MUCH for sharing your information, thats a true gentlemen!!!!
Annoying Precision
  • #26
  • Mar 24, 2010 10:59pm Mar 24, 2010 10:59pm
Quoting erikte279
thats a true gentlewoman!!!!
You're always welcome!
  • #27
  • Mar 24, 2010 11:01pm Mar 24, 2010 11:01pm
LOL IM SORRY!!!!!!!!! , very rare indeed

Quoting doblece
You're always welcome!
Annoying Precision
  • #28
  • Mar 25, 2010 12:38am Mar 25, 2010 12:38am
I hear ya there, I would never permanently ruin my Real opputurtunity, Trading isnt THAT hard. Food for thought though, read he got his face split open in prison real bad.

Thanks
Quoting The Fool
Just be careful with all those investor funds - you don't want to end up like Bernie Madoff. Prison looks pretty rough....

http://www.youtube.com/watch?v=EVBsypHzF3U
Annoying Precision
  • #29
  • Mar 25, 2010 11:00am Mar 25, 2010 11:00am
Quoting erikte279
Thanks,

My trading style is stress free and I only take a+ setups at this point with a high % of wins, slow and steady wins the race. Army 4 years, ets in 7 days

lol army? BOO! nah, im kidding. im actually heading into the air force next month.

with your slow and steady style of trading, expect a smaller ROR per month, and everything over your expected ROR is just extra awesome.
  • #30
  • Mar 25, 2010 3:12pm Mar 25, 2010 3:12pm
In the Army (Ground and Pound), we have a few Key words and phrases that we use to refer to airmen or seamen, I'll refrain . Good luck with your adventure because mine sure as sam is over !!

Jokes aside

Yes the point is just to maintain consistency with minimal drawdown. Trading this way I make my trade decisions usually in about 15 minutes a day and an about an hour on the weekend.

Quoting blacksun1
lol army? BOO! nah, im kidding. im actually heading into the air force next month.

with your slow and steady style of trading, expect a smaller ROR per month, and everything over your expected ROR is just extra awesome.
Annoying Precision
  • #31
  • Mar 28, 2010 3:27pm Mar 28, 2010 3:27pm
http://www.moneyscience.com/Hedge_Fu...o_Success.html
"If The Fool persists in his Folly he will become wise." - William Blake
  • #32
  • Mar 28, 2010 3:51pm Mar 28, 2010 3:51pm
Quoting erikte279
Hello,

I'n the future I'd be interested in trading investor funds. What monthly ROR % and average monthly Drawdown is generally appealing/acceptable for serious investors. Also any other information you would think useful.

Thanks
The higher ROR% the better, the lower DD the better. Also if they as you your trading strategy, don't say Strats Stress free trading thread on FF.
Economists have forecast 9 out of the last 5 recessions
  • #33
  • Edited 4:13pm Mar 28, 2010 4:03pm | Edited 4:13pm
http://www.greencompany.com/index.shtml

http://en.wikipedia.org/wiki/Hedge_fund

...fishin's good down Grand Cayman way I hear...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #34
  • Mar 28, 2010 5:50pm Mar 28, 2010 5:50pm
well your about as helpful as a hole in the head.

Quoting markmm
The higher ROR% the better, the lower DD the better. Also if they as you your trading strategy, don't say Strats Stress free trading thread on FF.
Annoying Precision
  • #35
  • Mar 28, 2010 6:06pm Mar 28, 2010 6:06pm
Quoting erikte279
Hello,

I'n the future I'd be interested in trading investor funds. What monthly ROR % and average monthly Drawdown is generally appealing/acceptable for serious investors. Also any other information you would think useful.

Thanks
show you can beat this market month in and month out for 8 months with little drawdown and decent profit.

people will give you money.

problem is... most here can't do it... most anywhere can't do it.

m
  • #36
  • Mar 28, 2010 6:15pm Mar 28, 2010 6:15pm
Acumen, thanks for your pivot indicator...when I put it on my charts, my pivots are about 20 pips different tha yours....any ideas?
  • #37
  • Mar 28, 2010 7:21pm Mar 28, 2010 7:21pm
Quoting acumen
show you can beat this market month in and month out for 8 months with little drawdown and decent profit.

people will give you money.

problem is... most here can't do it... most anywhere can't do it.
Its doable. But....

Can you do with $100+/pip what you did with $1.00/pip? And if you can will your bucketshop broker let you for very long? And if you have to bail out of the bucketshop, can you trade the same way from an institutional account - would it be much different? And, wouldn't you want to segregate investor funds in FDIC-insured accounts anyway?

And, if you lost $$,$$$ on dumb/risky trades in your solo account - will you be likely to do that with other people's money (OPM)? More likely you will trade with much less risk - certainly a good thing - but will that have an effect on that XX%/month you've been pulling in? Probably....maybe hopefully.

And, maybe it would be better to show you can trade in size - and maybe not have a ridiculous avg. roi on the books - maybe potential investors, that is, the type of investors you might like to have, and that is, investors with large amounts who would be happy as a clam with 5%/month - maybe they might rather see a lower, steady roi as opposed to a dizzy spikey equity curve? Just wondering, not sure... And then again - how much is too much? For a guy (like me, for instance) who has been trading all of one year would it be wise to jump into trading a $1 mio+ account?

And, if you do aim to trade in significant size, why would you limit yourself to forex only - wouldn't it be better to plan on trading multiple instruments, so that you can hedge in options, for instance? So, you'll be aiming to run a small hedge fund rather than just a set of fx managed accounts? Better, but more complicated - too complicated? What are the trade-offs?

And what about transparency? How much is good? Any? I mean transparency re: how trades are done. I see these fx managed accounts where there is a $100 minimum investment and the guy might be doing ok month in month out, hey why don't I just jump in with the minimum and copycat his trades - (since you can see trades as they are made, right?) - with 1000x that amount?

And omg why would anyone bother with a $100 investor anyway? If you stay private you have to rely pretty much on word-of-mouth, right? You can't advertise. So how realistic is it to surmise that you can string up a nice set of investors that way? How long might that take? And, to come back to Erik's original question for this thread, what kind of monthly/annual return might those folks want to see, with what kind of max. drawdown?

Just to get things started: how about 5 and 5? 5%/month on average with a max. drawdown on all positions at any time of 5%? (OK honestly, 5%/month seems very conservative to me now - but if my 5-figure account had a couple more zeros at the end, maybe that would be just fine.)

OK. What about management/performance fees? How about 2 and 25? And do you set a high watermark, a hurdle rate? I think you pretty much have to on the former - but the latter maybe not? But if you did, what would that be? Something pretty low these days....

And, what kind of investor fund retention do you have? Can they withdraw their money anytime? Or do you impose an early withdrawal penalty if they get out before 1-year or whatever?

I can probably think of a few 100 more questions but don't want to bore you. Besides, I got time...
"If The Fool persists in his Folly he will become wise." - William Blake
  • #38
  • Mar 28, 2010 8:07pm Mar 28, 2010 8:07pm
Good post, lots of relavent questions to ask oneself. I'm simply going to continue doing what I've been doing which trading with appropriate MM. All of these questions will be sorted out when the time comes, I'm very confident in the system I have and the results it produces.

That's all that's going to count when it's time to solicit to others, results talk, BS walks.

thanks fool

Quoting The Fool
Its doable. But....

Can you do with $100+/pip what you did with $1.00/pip? And if you can will your bucketshop broker let you for very long? And if you have to bail out of the bucketshop, can you trade the same way from an institutional account - would it be much different? And, wouldn't you want to segregate investor funds in FDIC-insured accounts anyway?

And, if you lost $$,$$$ on dumb/risky trades in your solo account - will you be likely to do that with other people's money (OPM)? More likely you will trade with much less risk - certainly...
Annoying Precision
  • #39
  • Mar 28, 2010 8:43pm Mar 28, 2010 8:43pm
Quoting The Fool
Its doable. But....

Can you do with $100+/pip what you did with $1.00/pip? And if you can will your bucketshop broker let you for very long? And if you have to bail out of the bucketshop, can you trade the same way from an institutional account - would it be much different? And, wouldn't you want to segregate investor funds in FDIC-insured accounts anyway?

And, if you lost $$,$$$ on dumb/risky trades in your solo account - will you be likely to do that with other people's money (OPM)? More likely you will trade with much less risk - certainly...
i don't have this much time.

hedge fund is hard to start on your own... but not as hard as many think.

you need your series 65.

you need to be able to trade.

most managed accounts have a 5K minimum.

many MF are very open... the lock out period is nill to several weeks.

my fund won't have lock out period because i settle at the end of the day.

5%/month should be doable for most solid traders.

the draw down is the key. (as low as possible and if it get close to 20% -you are done)

i trade opm with an account that allows the user to see their account and my trades every day.

investors don't get to give advice. when i hear... i think the euro is going here or there... i tell them to trade their own capital and call me when they are down 20% or more.

if you are good... a managed account should charge around 30% on monthly gains.

i like a high water mark after 100%/annually. most don't.

risk should be small... that's the key. the size of the fund shouldn't matter but i like 1/2%(total account value) per trade. no more than 2 or 3% on the table at any given time.

if you tell a client you'll make money when they do... they will be quicker to open the check book.

1% management fees are horseshit.

what did i miss?

mike
  • #40
  • Mar 28, 2010 8:59pm Mar 28, 2010 8:59pm
you need your series 65.

I mostly hear those tests are easy to pass, even the Series 3

most managed accounts have a 5K minimum.

That's more like it - but do clients see your trades in real-time or only at end-of-day?

5%/month should be doable for most solid traders. I hope so.

if you are good... a managed account should charge around 30% on monthly gains.

i like a high water mark after 100%/annually. most don't.

risk should be small... that's the key. the size of the fund shouldn't matter but i like 1/2%(total account value) per trade. no more than 2 or 3% on the table at any given time.

if you tell a client you'll make money when they do... they will be quicker to open the check book. I agree - trade your own money in the fund and not just a token amount.

1% management fees are horseshit. What - you don't have a management fee at all? or you mean they should be more? If its a standard in the industry why not go for it?

Many Thanks, Mike!
"If The Fool persists in his Folly he will become wise." - William Blake
0 traders viewing now