Trade for Proprietary Trading Firms
Another excellent way to trade, especially for those who are passionate about trading but may lack the sufficient funds (capital), is to trade for proprietary trading firms, also known as “prop firms”. Prop firms provide traders with the capital needed for trading, and offer them the best services and tools, as well as the mentorship and training required, in order to find success in trading. They then also share the profits with their traders. Essentially, traders do not need to have any cash. If they pass the consistency criteria of the firm, they will have access to a buying power assigned by their managers. As their skills in trading improve, their buying power will be gradually increased.
In 2020, I founded Peak Capital Trading, a proprietary trading firm based in Vancouver, Canada. We have been successful in negotiating an excellent commission rate from clearing firms with advanced trading platforms. In our firm, we offer a $100,000 buying power to new traders, and then we gradually increase it as they gain experience. For example, one of our junior traders now has access to a buying power of $500,000 after his first month of trading, as he demonstrated excellent trading skills. We also share the profit with our traders on a gradual basis. Those traders who make over $10,000
a month are able to retain 85% of their profits, and our firm retains 15%. With the advancement of technology, traders do not need to be in a physical office or at a firm’s trading stations. Our traders, for example, live all over the world and trade from their homes. One of the longest standing firms which offers excellent training and coaching is SMB Capital (
www.smbcap.com
), a firm founded by my dear friend and mentor, Mike Bellafiore, and his trading partner, Steve Spencer. Another well-known prop firm is Seven Points Capital (
https://www.sevenpointscapital.com
).
I recommend considering joining a prop firm if you are really passionate about trading but do not yet have sufficient capital saved up.