Prop Shops? Heaven or Hell?

[GCB]

While the market was making its nice breakdown and rebound during lunch today, I was at a long businessman's lunch with a friend of mine. What were we discussing? Nothing less than my life and its direction. I have been looking into alternative possibilities to trading from home. He suggested this firm:

Kershner Trading Group

Which has its main trading floor in the city in which I live. This is a prop shop. Does anyone have any experience with these things? I realize they are basically going to supply me with capital, support and proprietary software with which to trade. And I realize they focus on stocks, though they say they do futures.

Any thoughts, ideas, dismissals or outright scoffs will be welcome.

[rock]

Have you tried contacting them?

Andy Kershner is a former ProTrader owner and a former chairman of Zone Trading Partners, LLC. Both firms were located in Austin.

I heard something scandalous occured with his partners at Zone Trading and it closed. Kershner later started up again as Kershner Trading Group. Sorry, I don't have any info on my computer anymore.

http://blog.bluestonelawfirm.com/leg...e-lawsuit.html
New York Attorney Malpractice Blog: Former ProTrader Owners Settle Legal Malpractice Lawsuit

http://www.traderinterviews.com/prog...dyKershner.mp3


Here is a quote that I have of something he said to a reporter:
"Houston-based stock trader Andy Kershner sees the changes. Six years ago, Kershner was a day trader betting his own money on 20- to 30-point swings in individual stocks. In March 2000, he made a big bet that technology stocks were about to fall, but did it a day too early and lost several hundred thousand dollars. Kershner, chairman and chief executive of Kershner Trading Group LLC, now finances and oversees 90 traders who use computers to make enormous bets on far smaller stock movements, generally one to three points, he said.

"Back then, almost everybody traded manually, and they were scrambling and yelling on the phone," he said. "Now you're pushing buttons. You can automate all or part of your trading strategy, and if you don't, you're going to get crushed."

The long boom leading up to the 2000 peak made trading seem easy, Kershner said. "Then, you didn't have to be in the right spot to succeed because the market covered up your mistakes. You just held onto it until it came back," he said.

Today, "there's not the same euphoria.""

[rock]

http://mloylo.blogspot.com/2007_08_01_archive.html

This guy started in August at the firm and has been posting some stuff on his blog.

[james_gsx]

I would look into a few things first.

1 - How much capital do they give you when you put up say, $20,000.
2 - What percent of the gains do you get to keep? There are some that let you keep 100%, I would lean towards those.
3 - What trading software do they use? Is it their own or do they use someone else's software? For example I know Bright uses RediPlus from Goldman Sachs.
4 - How strong is the firm financially?
5 - Does their style of trading interest you? If it doesn't, then theres no point. If you just want to trade the way you do now with more capital then I would look for a firm that just lets you be.

I looked through that Kershner Trading website and I liked the team trading idea. But if you like to work alone, that might not work. I suggest you contact them and ask to check out their office on a trading day and see what you think.