Would you fund a trader with a proven record?

[tech/a]

If the account is up from initial amount you get commission. Once commission is paid thats the "high water mark" for any further profit calculation. No further profit is paid untill an equity high is surpassed - the "high water mark" .

Your right.
Apologies.

 

[skc]

skc: you will have to check with someone who's done this before like Trembling Hand on tax of advisor fees. I have never been an investor in one before and my current investors have only been 5 months so far have not been tax time yet. I'm assuming if IB's statements has the fees listed on them you can claim tax off it, I will not be issuing anything of any kind officially to you personally.

You don't need to issue any official invoice for it to be tax deductible expense. As far as I am concerned, I invested $100k and I ended up with $120k in my IB account, I pay tax on $20k net profit. It doesn't matter that my gross profit was $30k but you've taken $10k as fee/commission. As long as my IB account is a "closed system" the tax treatment should be simple and the fee should definitely be deducted for tax purpose.

Obviously get your own tax advisor blah blah blah, but I'd fire my tax accountant if he tells me the fee isn't deductible.

I have only been compounding for 21 weeks and currently on target to achieving 50%+ which would mean 35% after fee, before tax.

How much money are you trading with now vs how much money do you plan to trade for others? It's very easy to compound on a small account but once the numbers get 20x larger, you may find that the "internal compounding over the year" approach becomes less viable.

If your method is truely scalable and you have a track record, have you consider joining a prop shop (or whoever that will endorse such strategy)? It's way simpler and more rewarding set up than what you are trying to achieve with "friends and families" accounts, plus it's probably more legal! I don't know if Propex does future options but someone might know the answer.

 

[todasec]

skc: Makes sense, if IB steals your profits you should be able to claim it. I am trading 271k in my master account and client's amounts I do not wish to disclose but is bigger than my own account but well under 8 figures. My personal account which has a different risk profile is 578k but it is crossmargined with 2 other strategies so only a portion of it is actually under this strategy. Varies depending on my discretion.

My frequent trades are near the money SPY strikes with usually 20k+ daily volume and 50k+ op int. I don't know how scalable it is have not traded tens of millions but even with a 10 million capital I still will not make up more than 1% of the volume on any given strike I am trading. Have not experienced 1c slippage on fills yet, full order always gets filled instantly when I go to the ask. I don't really day trade just adjust my positions which means I may not do any movements for few days or sometimes 2 or 3 times in a day.

That is my theory that until I start receiving 1c slippages (eg. buy fills 300 contracts at 14c, and 120 contracts at 15c), I do not have to worry about scalability and diminishing returns. Bigger volume actually reduces my brokerage.

I have gave a quick thought to trading firms but they seem pretty demanding in their criteria which clashes with my own demands. ie. I will trade my own hours, I am not going to move to another city, I do not wish to report to an office. Plus I am too small to be taken seriously, maybe after I've traded larger amounts of money.

Cheers for the input, gets me thinking more. Back on the topic of scability if I notice my return is suffering because of more capital, I will close out this fund or start charging less fees until I work out a point where the fees I am charging is highest for me while not impacting clients returns.

 

[skc]

I have gave a quick thought to trading firms but they seem pretty demanding in their criteria which clashes with my own demands. ie. I will trade my own hours, I am not going to move to another city, I do not wish to report to an office. Plus I am too small to be taken seriously, maybe after I've traded larger amounts of money.

I think none of these concerns are valid. You trade your own hours, you can trade remotely (many do from their own home), there's limited reporting (certainly way less effort than managing 20 friends and families), and the account size you mentioned is more than meaningful from a prop shop's perspective. i.e. you will be taken seriously if you can backup your claims.

The only real control you get from a prop shop is your trading size, and that will grow as they see your strategy working and get more comfortable with you. It also saves you pimping yourself on a public forum for more funds.

I don't know if any prop shop have option desk / traders but you should certainly investigate more as the concerns you have seem unfounded.

 

[todasec]

There's actually no reporting for me at the moment. Everything is in their own account they can see the statements IB generates. Only had to go through how to read a P/L statement with one guy who was a non-trader. On my side I just get a summarisation of all accounts and fees paid to me.

If I can find any prop shop who will give me a large funded account allowing me to trade freely with my rules with same or higher profit fees without bothering me then yes I am definitely up for it. I will narrow down some firms tommorrow and send some emails. Thanks I will keep you informed of any luck.

 

[Trembling Hand]

I have gave a quick thought to trading firms but they seem pretty demanding in their criteria which clashes with my own demands. ie. I will trade my own hours, I am not going to move to another city, I do not wish to report to an office. Plus I am too small to be taken seriously, maybe after I've traded larger amounts of money.

Hahahaha

WRONG!

todasec from your limited posting its hard to take you seriously as we get people blowing in every few months wanting to be the next Soros. Best advertising you will ever get is to start your own thread and run some trades live. Everyone talks the talk few every take a step - let alone get into a trot.

 

[CanOz]

Hahahaha

WRONG!

todasec from your limited posting its hard to take you seriously as we get people blowing in every few months wanting to be the next Soros. Best advertising you will ever get is to start your own thread and run some trades live. Everyone talks the talk few every take a step - let alone get into a trot.

First of all Todasec, welcome to ASF. I think TH has a great idea, why not start a thread with some stats on your system, some live trades even...People that have done this before tend to develop credibility quickly, TH is a great example. Tech/A has also displayed a system publicly in the past.

It could become a very popular thread and attract some attention for you. If you contribute here, then I'm sure everyone would be more than willing to tolerate the fact that you are sort of "advertising"...

Actually i met another chap, through his thread, that is doing something similar to you but with Iron Condors(is this the same). He is funded, but looking for more clients.

Cheers,


CanOz

 

[todasec]

Trembling Hand: that is fine I will be here from time to time posting results. If I ever stop without saying anything it means my system is broken. I will post when I do not need any more funding so if I dissappear for a long time without updates you can take it as my performance sucked and I am too embarrassed to post it and write me off as another Soros wanabe.

I have got one guy from another forum who is interested and is in the process of funding just a $10k account to see how it goes for a few months. Worst case he will lose $1k and shut me off. If it does performs as expected he will be adding more funds.

CanOz: Thank you for the welcome, attached is the updated stats although it has only been a couple of days since I last posted my stats. I am not sure about starting a new thread as advertising so I will stick to here for now. Live trades will be good although you will have to stick it out for a few months for the returns to be meaningful. I will look for something that is a trustworthy third party monitor of live trades, something like myfxbook but for the options market.

EDIT: Not sure what happened to the SPX chart at the end where it falls right off..seems like IB has some data problems.

 

[Trembling Hand]

Trembling Hand: that is fine I will be here from time to time posting results.

Problem is if they are not live they are not worth a pinch of........

You should run it on Collective2.com If your equity curve looks like that after 6 months you will do very well.

 

[todasec]

I do not have time to post here everyday right as I trade, which is why I offer anyone who is interested but suspicious wants to verify the results can meet me and poke around in my account with their own eyes.

I was going to open a demo account on IB and trade it while giving a few people who is voted to be trusted the password to the account so they can monitor it real time, but that may not be necessary with the site you posted. Thank you for the link, you may have found a solution for me as it is automated.

 

[Gringotts Bank]

Problem is if they are not live they are not worth a pinch of........

You should run it on Collective2.com If your equity curve looks like that after 6 months you will do very well.

Are you on Collective2?

 

[CanOz]

Are you on Collective2?

lol...

 

[Gringotts Bank]

I do not have time to post here everyday right as I trade, which is why I offer anyone who is interested but suspicious wants to verify the results can meet me and poke around in my account with their own eyes.

I was going to open a demo account on IB and trade it while giving a few people who is voted to be trusted the password to the account so they can monitor it real time, but that may not be necessary with the site you posted. Thank you for the link, you may have found a solution for me as it is automated.

There's a few ways to gain trust through 3rd party verification websites. This is the best known.
http://www.timertrac.com/Public/Default.asp

 

[Gringotts Bank]

lol...

what's wrong?

 

[CanOz]

what's wrong?

Sorry mate, he could very well be on C2...but it just struck me funny why a Prop trader would be on C2...

CanOz

 

[Trembling Hand]

Are you on Collective2?

You are not serious are you?

 

[boofis]

Curious to know whether anyone has changed their views on this/tried pursuing ideas like this/is now funded/is now funding etc.

Any discussion would be valuable just for my own use

 

[andrehughes]

I would definetely fund someone with a poven track record that also works with a reliable broker and keeps risk under control.

 

[minwa]

Anyone else kept in contact with this guy ? Just saw his latest performance and he has outrageously low draw downs with a equity curve that seems to be fabricated. Anybody shed some light on gamma scalping ?

Would be interested in seeing someone offering something similar but through a company/business with proper licenses. Would like to diversify a bit of my own portfolio.

 

[tech/a]

Trembling Hand: that is fine I will be here from time to time posting results. If I ever stop without saying anything it means my system is broken. I will post when I do not need any more funding so if I dissappear for a long time without updates you can take it as my performance sucked and I am too embarrassed to post it and write me off as another Soros wanabe.


CanOz: Thank you for the welcome, attached is the updated stats although it has only been a couple of days since I last posted my stats. I am not sure about starting a new thread as advertising so I will stick to here for now. Live trades will be good although you will have to stick it out for a few months for the returns to be meaningful. I will look for something that is a trustworthy third party monitor of live trades, something like myfxbook but for the options market.

EDIT: Not sure what happened to the SPX chart at the end where it falls right off..seems like IB has some data problems.

Guess that didnt end that well?