If I join a prop trading firm, will I enjoy low commissions
If I join a prop trading firm, will I enjoy low commissions
Loading saved threads...
Victor123 · External communityPost link
External question — Personal Finance Stack Exchange
Author: Victor123
Original post: https://money.stackexchange.com/questions/45716
License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/
Adaptation: HTML converted to plain text; contact email addresses removed.
I often hear that professional traders pay negligible (<1 cent ) commission per trade. Is this true?
Does this mean that if I open up an account with a prop trading firm in Toronto and put up 25k, I get to enjoy the high leverage and also pay next to nothing in commissions?
Quote
Report
MD-Tech · External communityPost link
External answer — Personal Finance Stack Exchange
Author: MD-Tech
Original post: https://money.stackexchange.com/a/45717
License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/
Adaptation: HTML converted to plain text; contact email addresses removed.
Prop (proprietary) traders trade using huge amounts of a bank's money (i.e. other people's money) so the reason why they have such low commissions (and they certainly do) is that the firms for which they work negotiate low commissions as the quantities and volumes (as they also trade very frequently) will be high and so the total commission will be very high. There is no such thing as a prop trading account unless you are a big bank with a very large bank roll (tens of millions of USD) so you cannot open one to enjoy those benefits unless you have enough money that you can negotiate your commission with brokers. 25k CAD is definitely not enough money to even start a conversation about those sorts of commissions.
note: prop traders are generally banned from trading intraday with their own money by their employers and the law as it is a massive conflict of interests. Those who do and get caught face lengthy prison sentences.
Quote
Report
Post Reply
Quoted from Forex.com.bd-Editorial External answer — Personal Finance Stack Exchange Author: MD-Tech Source score (net votes, not local likes): 3 Original post: https://money.stackexchange.com/a/45717 License: CC BY-SA 3.0 — https://creativecommons.org/licenses/by-sa/3.0/ Adaptation: HTML converted to plain text; contact email addresses removed. Prop (proprietary) traders trade using huge amounts of a bank's money (i.e. other people's money) so the reason why they have such low commissions (and they certainly do) is that the firms for which they work negotiate low commissions as the quantities and volumes (as they also trade very frequently) will be high and so the total commission will be very high. There is no such thing as a prop trading account unless you are a big bank with a very large bank roll (tens of millions of USD) so you cannot open one to enjoy those benefits unless you have enough money that you can negotiate your commission with brokers. 25k CAD is definitely not enough money to even start a conversation about those sorts of commissions. note: prop traders are generally banned from trading intraday with their own money by their employers and the law as it is a massive conflict of interests. Those who do and get caught face lengthy prison sentences.
Checking account access…