Remote Trading on US Stock Markets

What’s the difference between Remote Trading and a job in the prop trading offices

Remote Trading is still trading for the proptrading company, but in this case to own financial risk and without the owner of the branch. You trade directly for the head office of proptrading company with the own financial security.

You trade directly for the head office of the company or subgroup, which cooperates with it. Such subgroup is Global Markets www.tradingglobalmarket.com. In each of these cases you are sure of receiving a great payout. In case of subgroup dedicated to the given market (in this case us) you have a full support in local language and a lot of extras .

However, the key is that as a remote trader you take the financial risk. You have your security in a form of “performance bond”. In case if you lost in a unique situation more than you have on performance bond, you will have to cover this difference.

Although, in those companies are departments of the risk management, which guard maximum level of performance bond, there may appear unpredictable situations.

What the prop trading company provides?

There are certain differences between what the proptrading offices provide, and what do you receive as a Remote Trader.

  1. Trading Capital – so-called buying power

You have good trading strategies, but for example you don’t have a capital. Buying power offered by the proptrading company will provide it for you. Buying power, i.e. capital, which you can use in trading. Here I emphasize that this aren’t the customer’s money of the company, etc. The company doesn’t accept any deposits from people from the outside. Therefore, you don’t manage money of third parties.The remote trader provide a certain amount as risk capital(usually small) to cover future losses and technology costs.

  1. Commission rate

You are an active daytrader, carrying out a few/several or dozens of transactions within a single session. In such a case you start calculations. Where it will be cheaper? In case of Remote Trading – commission level depends on the volume generated by you.

  1. Payout split

In case of Remote Traders, payout split is usually on a level of > 80%. Everything depends on whether you have a trading history. Your average monthly profit is significant and on it the offer is based, which you can receive for the given moment.

  1. Charges for data/platform

Traders in proptrading companies are treated as pro traders, i.e. they pay for stock market data in a professional form. Therefore, all quoting cost about 300$

  1. Trading position

As a Remote Trader for trading position you must take care yourself. Apart from the computer you must pay attention to stable Internet connection.

  1. Development/trainings

Remote Trading is directed above all to experienced traders. Therefore, companies don’t offer trainings or courses for people who wish to open an account.

Do you want to be a Remote Trader?

Remote Trading is not for everyone. In case of companies, which offer a possibility of remote trading – most requires interested parties – so-called track record i.e. trading history.

Alone for a few years I did similarly in my group. Then I decided to open also to completely green persons. I stated that if somebody strongly wants, and succeeds – why not to give him a chance?

Not everyone has so close to the proptrading offices, in which they can start. In such case, the possibility of trading as a Remote Trader is perfect. However, remember that being a remote trader – you are your own boss. Hence, no one will stand over you with a whip and guarded whether you are cutting losses out, whether you hold on to your assumptions. Through this stage you will have to go alone.

Somebody may say that Remote Trading takes traders from proptrading offices. Yes, it’s true. But such is the market. It’s the same as traders change accounts in brokers, because one has a better offer from another. It’s similar on this market. In my perspective – I traded for a few years in the office, I let the company earn. For me transition to remote trading or trading at the broker it is the only option for definitely better payout i.e. profit distribution.

What is the difference in payout split

Thanks to prop trading, traders are able to receive payout up to > 90% of results, rather than 30-50 % as in proptrading offices. I provide this level from 80% with a lack of trading history. A considerable difference, isn’t it?

What agreement is concluded in Remote Trading?

It is usually so-called Trading Service Agreement. You sign it directly with the proptrading company. Based on this agreement, you receive conditions that you negotiated on the basis of your experience. Formalities in addition to signing the contract apply to signing the next “Exchange agreement” for quotes and access to markets. After all that remains transfer – and expectation for your account activation.

Settlement of taxes

In proptrading offices the owner usually employs traders on different type of the agreement. In case of remote traders, the agreement is signed directly with the head office of the company. All settlements are on the head of trader. He must take care of tax settlements. Most often remote traders have their business activities.

Remuneration

Remote Trader earns only % from generated profits. Companies don’t pay the base salary.

You have experience in U.S. markets

In this case, the terms of cooperation may be even better. Personally, when I receive so-called track records (i.e. history of trader results) I see clearly – what are the trader’s slides of capital, risk and stability. In case of good track records, we negotiate even better deal for trader.

Remember that proptrading companies differ from brokers, that they are interested in traders. The aim is to take the last cent provided that you carry out turnover. The most valuable are traders who generate profits, best stable. Do you see the differences in relation to the broker?

You don’t have experience in U.S. markets

In this case, I think that it is worthwhile for beginning to reduce the risk. Learn to trade; develop your strategy – with smaller risk. Don’t try to earn a lot of money right away.

It is not a casino.

Start with 100 shares, which constitute the minimum size of position. Reduce your daily losses to e.g. 50$, or maybe to 30$.

Reduce the risk – do not trade on expensive companies, with high volatility, high spread.

In this case, the terms of cooperation can be standard on the start. In relation to the fact that you don’t have trading history, the company isn’t able to determine to determine the risk to which you expose them and your potential.

How much time is it worthwhile to devote when you don’t have experience?

Everything depends on how much loss you can afford and how much free time you have. Just as in the proptrading offices, I think that a period of 4-6 months is appropriate, maximum 8 months. If at that time you won’t start to generate profits, you should find yourself a different job or try on other market.

It happens that I beginning the cooperation with remote traders, who give up after a few sessions or 2 weeks. In my opinion, it is too short period to check and assess own potential.

As a Remote Trader must I pay some funds?

Yes, as remote trader you have your own financial security. The same as when you open the account at the broker. However, you don’t trade with these funds, they constitute so-called performance bond. This is security up to obtained Buying Power – i.e. real funds, which you can trade on the stock-market.

Is it only daytrading? Whether they are possible overnights?

In case of Remote Trading, there is possibility to use overnights. However, in this case a greater financial security is required. Such a possibility is usually offered to traders, who have already experience and trading history.

If you don’t have an additional agreement, which enables you to use overnights, in such a case when unhappily you won’t manage to close the position – you must be aware that payment for leaving position overnight will be charged (rather small) and the company takes over the entire profit, but the loss is on you.

 Pattern Day Trade Rule

Trading as a part of Proptrading Company, we avoid Pattern Day Trade Rule. Thus, trader is not forced to hold the capital of min. 25 k$. Of course, this doesn’t mean that such or larger security traders a part of proptrading company don’t have. However, at the beginning it is possible to start from 2 k$, which in relation to 25 k$ constitutes a big difference. More to this subject you can read in the article: Pattern Day Trader – what consists of and how to avoid it.

want to be a day trader….Do you have what it takes?

A guideline of how to make it as a trader as a profession. It will take hard work and patience in your journey.

Step 1. definitely start studying anything and everything about the market. The more you learn the more you will find you don’t know. The market is every changing and you have to adapt as the market changes.

Step 2. try to find a program or mentor that you mesh with that will keep you motivated along your journey. There are many out there. Make sure whomever you choose that they don’t boast a guarantee of their product to make you profit. Everyone learns differently and everyone has to find a strategy that works for them.

Step 3. Determine how much time you can honestly devote to trading. This might be something you will be doing part time to start as you are still working you 9 to 5 job.

Step 4. Once you know who you want to work with and how much you can devote then study up, and start your paper trading. I highly recommend paper trading to find your strategy. It is much easy to pay $30 a month to practice than lose your hard earned money. Remember that if you need to paper trade for a year that is roughly $360 versus thousands you could lose in your first account (I speak from experience on this one…I blew through a $6k account in a couple months not knowing)

Step 5 Once you have consistency and confidence in your personal fingerprint strategy. It is time to open your trading account. Depending on where you are in the world there are different brokers that you can use.

Step 6. Journal you trades from the moment that you begin trading a free site is Profitly

In trading you are not in competition with anyone else. Everyone learns at a different pace and your goal is to be profitable. Trading the right setups at the right time will help you be profitable. The more you keep track of your trades and your emotions in entering the trade and exiting the trade you will understand your trading pyschology. You are your own worst enemy in trading.

Step 7. Continue to grow in your trading. As your real money profits begin growing remember there are 4 outcomes: Big Wins, Small Wins, Small Losses and Big Losses. If you simply get rid of big losses and learn to let the Wins grow then you should be able to continue growing your account.

When you mess up know it is part of the trading journery and use it as a learning experience. If you need to step away from trading and don’t take it out on the market. Trade with a clear head.

This blog is for information purposes. We are not a registered securities broker-dealer or an investment adviser. The information here is not intended as securities brokerage, investment or as an offer or solicitation of an offer to sell or buy, or as an endorsement, recommendation or sponsorship of any security or fund.

Credits:- This blog was written by Airplane Jane. To know more about her visit https://seejanetrade.com/

Lightspeed Trading Platform for Indian Trader

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How do you cut losses?

trading-plan

 

I’ve been always wondering how to cut losses, I know I should do what the market tells me to do, I’m not looking for that kind of answers. Here is the scenario:

Assume I buy reversal according to oversold and a few other indicators (or other trading strategies), I had a good setup and entered a long position, but the price continued dropping and my loss had reached my maximum loss per trade, I should close my position according to my trading rules. But, on the other hand, it’s more oversold and I have a even better setup, I should buy more instead of cutting losses. This is a dilemma.

What do you do and why?           318178829_c5863b5c15a.jpg

Well there will be many answers to this questions including some harsh one which you do not want to listen (believe me i have heard them, Not good..). But here are a few informative one

bottom fishing

1). I think you should stick to your rules and cut your losses…but learn as much as you can about reentering to catch that eventual reversal. Markets can decline far more than anticipated…you don’t want big losses! Many will say your crazy for trying to pick a bottom…those traders will be the trend followers. It sounds like your best bet is to follow a good plan of cut your losses and maximize your gains…so, cut those losses!

FYI…Hardly 5% trade like any of the above but hey who i am kidding. They are those who make money.

 

2) It’s good that you set a max loss per trade. I would sell at my sell signal or stop loss and move on. No sense crying over it…. Just move on to the next trade. Just because something is oversold does not mean it will revert to the mean or reverse. If it’s a strong down trend it can remain oversold for a long time. And if you think the market HAS to revert because it SOOOO OVERSOLD and it just CANT stay this oversold that long then that too is poor thought process. The markets can remain irrational a lot longer than you can remain solvent. Don’t try to argue with the market or believe you can control the market or even understand the market. Just follow what it is telling you. No matter how irrational it may seem.

arrow_crash

I think it’s good that you have determined a max amount of loss per trade but I can’t say whether you have chosen an appropriate stop loss. You could have a stop $0.10 away and have 10,000 shares which represents a $1000 max loss or you could have a stop $1 away and have 1000 shares also representing $1000 loss. Your max loss (in this example $1000) may have been achieved with both trades but which if either had the better stop loss chosen???

 

3) I don’t recommend being in the top and bottom picking business especially for a beginner but as to losses, know where you want to get out if the trade goes the other way before you enter. Hard stops or mental limits are personal choice but there needs to be a defined point where you cut bait.

 

Well whatever the method is , they say “every penny saved is a penny made”. Market always have opportunity to get in and out and make profit. What a trader (Poor Fellow ! ) can do is wait and make the same mistake repeatedly, Zillions of time till he learns to do the right thing. And there should be some money left to enter the market and make mummy proud !

Flat background with hand and money bag. Money making. Bank deposit. Financials. Vector illustration.

Proprietary Trader- Self employed Day Trader

Prop-ret

Retail trading vs Prop-house trading

For a start, when many people think of being a self-employed day trader, they may think of someone that is in a room on their own, has their setup at their house and looking at charts in their underwear. These are called ‘retail traders’ (not specifically those that trade in their underwear) and are generally considered part of the retail market. In other words, they access the financial markets through online brokers.

 

But in fact, many traders at institutions are also self-employed. These are called ‘prop-traders’ and the places that they trade at are called ‘prop houses’.

Now, it is not that black and white; not all those that trade at home would be considered part of the retail market – you can get institutional setups at home. But for the purpose of this answer, and introducing people to the life of a self-employed trader, we’ll start by generalising a little.

There are pros and cons for both:

Trading at a prop-house

Firstly, you are subject to the costs of running a business. You have have to rent your desk space, news and data feeds and trading software. All of this can be of a starting cost from £2000 per month. This means that you have to make at least £2000 to even make break even in a single month.

However, this cost is not for nothing – you will generally get excellent execution times and cutting edge software. The only thing to consider is that the technology gap and execution speeds between what is available at the retail level and prop/institutional level is  closing fast- if it hasn’t closed already.

The great thing about being a prop-house trader is the fact that you are immersed at a physical level.

When you are trading at home and you are by yourself, you may have squawk boxes and other notifications of breaking news. However, nothing can substitute the building of energy that occurs when something ‘breaks’ in the market.

You can feel the buzz of people talking, discussing trading positions and you can develop a sixth sense when someone else put on a trade – you can benefit from simply being there.

Trading at home

2073372_orig       trading desk

 

That is not to say that you can not build an environment at home that allows you to trade with others – you can, and it is highly recommended that you do. You can find online groups on Skype, communities and forums, as well as trading rooms  – all where you can share information with others.

However, there are a number of things that you will need to take into account. Firstly, you will have losing days. You know this, you have experienced this if you are trading already and you think that it’s no big deal in your current setup. But think about a losing week!

When the markets are simply not playing ball, it is difficult to keep up morale and motivation and not resort to psychological influences. Imagine taking the tenth setup only to see the markets whipsaw you out of your position again!

A week can seem like a long time and so it would be advisable to build a fail-safe into your planning. Who are you going to speak to and how are you going to manage your psychology when you need help? This is where online communities and online coaching sessions help – simply because you can be in contact with others.

The software for retail traders is powerful and simple

 

As already discussed, the technology available to retail traders is becoming more sophisticated and easier to use everyday. In fact, some prop-house traders sometimes prefer the tools available to the retail markets, simply because of the usability of it. Also more often than not, the software is provided free by a broker and can be customised to suit the the trader.

This also means that the cost of doing business is very low, as you do not have to pay for a professional setup and maintain it each month.

Maintain contact with the outside world

 

 

Life as a day trader on your own can be tough and you need to make sure that you have adequate contact with others. This may be laughable as you think how simple this is, but ask anyone that works from home for a living. They will tell you that the most difficult thing is lack of contact with other people. It’s easy to go a full week without meeting and talking to people; most people that work in an office take this for granted.

This is compounded as a trader, because you never know what the end result of your efforts will be. Day trading, like any other trading, is a game of probabilities and you never know how your month is going to end, how much money you will make and how big of a drawdown you may get. You need to make sure you can get things off your chest, otherwise things can be very difficult.

However, you must also make sure you talk about your trading to other traders. Your friends outside this trading world will not understand where you are coming from. They may encourage you to give up, telling you its too difficult. You need contact with those that have been through the pain barriers and have come out on the other side.

This is why is it very prudent to make sure that you become part of a forum or go to live coaching webinars where you can interact with other traders.

Part time

 

part

 

Being a day trader does not mean that you are glued to the screens all day long either. Many people make the mistake thinking that to be a day trader means that you are looking at charts all day long.

The fact is that many day traders may look at a set of charts every hour, 4 hours or just once a day. You are still a day trader, but instead of taking many small trades that last for a short period of time, you take far fewer trades that last for a few hours, days or even weeks. Their interaction with the financial markets is actually quite minimal.

This means that you have plenty of time to do other things. Perfect if you are a free-lance writer, self employed plumber, electrician, work in a retail shop or hospital where you have shifts – any situation where you need to weave your chart time into your normal daily routine.

This also means that you can relieve the burden of having to make your money through trading alone. The advantage to this type of day trading is that you lighten the pressures of having to pay for your rent, food and other essentials in the face of having a possible losing month.

And this leads to the next point – being properly financially setup .

Have more than one source of income

When you are self-employed, you need to make sure that you (and also your family if you have one) can eat at the end of the day. Having a losing month can lead to a downward spiral as you constantly try and fight the markets and make subjective trading decisions.

If you do decide to become a self-employed day trader, you need to make sure you have a primary income other than trading; at least in the beginning. This way, a winning day, week or month becomes a ‘nice to have’, not an essential.

Scalping the markets

That is not to say that your destiny may not ultimately result in becoming a scalper ( a trader that scalps the market for trades that last for a matter of minutes or even seconds). Scalpers that trade for a living can literally be in and out of the markets in an instance.

Imagine getting up at 7:30 am, scalping money out of the markets and hen going for breakfast at 8:00 am. Sounds too good to be true? Well, you know what they say. The fact is that there are traders that do scalp and there are traders that do actually make their money by 8 am. But this is very hard to do and you need to have a very good understanding of probabilities and the markets. And always bear in mind, those traders that scalp money out the markets and are in and out in a matter of seconds, may still be looking for a setup for a few hours.

This requires intense concentration.

It wouldn’t be advisable to be doing this all day either. Many scalpers find an optimal time to scalp – say, at the open of a market, such as a forex trading session, and they do it for a short period of time. Scalping requires attention and focus and so those that scalp for a living seldom keep up this level all day.

The right approach

In summary, day trading can be a horrid slog or the best job in the world with financial freedom at your fingertips.

Which side you fall down on simply depends on your approach and whether you get into it in the right way. The right way is to look at this is as starting a business.

To start any business requires starting capital. Expect to deal with expenses and costs, as well as considerations on how advanced you are in your trading knowledge to be able to do it for a living.

Education is everything

 

trading-plan

 

You need to know what you are doing and so your education is extremely important and you shouldn’t rush it – especially if you are entering the self-employed trading world from a non-financial institution/background and have learned everything from self-study.

As long as you approach it right, and you have the right setup from the beginning then the answer is easy:

What is it like being a self-employed day trader?

It’s the best job in the world!