Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

Recommended Posts

I have developed systems for years and manage a fund trading primarily SPY and other liquid ETFs. I can't keep away from the e-minis because of their leverage, and my models work so well on them.

 

Hedge funds and futures trading are a different animal, politically. They are regulated by different bodies and have different requirements for money management.

 

I would very much value hearing from other developers who have considered becoming a CTA to manage money trading futures markets.

 

Thanks - -

 

ws

Share this post


Link to post
Share on other sites
tell me, if you start with US$10,000,

how much (conservatively) would you have by the end of the week?

 

:roll eyes:

 

End of the week? You really want to judge him based on a guess of what you would have in a week?

 

That's too funny Tams. Great joke, I appreciate it.

Share this post


Link to post
Share on other sites

Brownsfan is right, weekly is not the best metric, and this is all off topic.

 

To manage a fund you don't need certifications, series 7, etc. until you are up over 30 mil. or 100 partners I believe.

 

They are changing these requirements as the SEC looks dumb after the Madoffs and Petters walked all over them.

 

My systems trade about 8 times a month, are in the market an average of 3 days. The futures trading is up about 10% this month and historically returns about 87% annually (not compounding).

 

I guess I posted this question in the wrong forum...

Share this post


Link to post
Share on other sites

waveslider,

 

I did it a couple times back in the late 80's. Simply didn't enjoy it. The 'business' responsibilities and etc of OPM just wasn't my cup of tea. But you may be fine with it. A friend of mine got his CTA about the same time, did it through '03 and retired and never seemed to have any of the issues I had with it.

 

Have you done any OPM at all? Testing the waters with a small GP type arrangement would be the route I would have taken had I known then what I know now about myself :)

 

Hope this helps.

 

zdo

Share this post


Link to post
Share on other sites

 

To manage a fund you don't need certifications, series 7, etc. until you are up over 30 mil. or 100 partners I believe.

 

They are changing these requirements as the SEC looks dumb after the Madoffs and Petters walked all over them.

 

Waveslider,

 

What you mentioned above, regarding certification and license, I assume you are refering to the US regulations correct?

Also you mentioned that there is no need for any type of certification etc.. I, for some reason, thought that in the US one needed to be licensed to manage a fund and solicite money i.e. raise money.

It may be that one needs a license to solicit money only...Im just goign on some things I remeber hearing or reading therfore not 100% sure.

I am curious as it is something I would be interested in getting more informaiton about.

Share this post


Link to post
Share on other sites

ZDO, that is very helpful hearing your experience. Being a CTA does seem like a lot of potential paperwork/bureaucracy, not to mention fees.

By OPM do you mean some type of portfolio management? I don't know what an OPM is.

 

Currently I am structured in the standard way, a LP managed by an LLC.

 

Sep34-

You can't hold yourself out to the public as an advisor. There are strict regs. about marketing material, etc. The way I raised money was via friends and family. If you do well, the money finds you - to a certain extent. It's hard to get to $10 million, but once you do - it goes really quickly.

(this is for the US)

Share this post


Link to post
Share on other sites

OKNIFD= ok now I feel dumb...!

 

Thanks again for your experience zdo.

 

For anyone who is in the same boat as me here, it looks like what I am trying to do would be considered a "QEP EXEMPT POOL"

 

QEP= Qualified Eligible person"

 

You have to submit a letter to the NFA saying that's what you are doing and the # of the exemption you are filing.

Share this post


Link to post
Share on other sites

The 'friends and family" concept is accomplished by a CPO - commodities pool operator - who has requested exemption status from the NFA. The vehicle is a LLC and no further reporting is required (except to the LLC members). Not even the broker need be involved. The trading account is set up in the name of the CP LLC with all members listed. The limit is 14 and under $2mil.

Beyond that is the full CPO with accounting to regulatory agencies.

However, and you may want to be careful right now about using this forum in public to discuss this. Solitciting is a fine line. You cannot solicit money from anyone for the purpose of managing money or for trading for someone else. You may have crossed the line already and the CBOT and NFA are getting paranoid and are starting to clamp down. So, I recommend you take this entire string off the forum and pursue this privately. It would be a shame of TL got tagged as a solicitor or associated with non-authorized persons soliciting monies.

Share this post


Link to post
Share on other sites

edabreu - you beat me to it.

I am not 100% sure about the US regulations, but in the UK and other parts of the world there are big differences in retail v wholesale or professional money.

If you are not licensed you can say virtually anything and get away with it, but once you start taking peoples money then you have to be very careful about what you say, who you say it to and what you do.

This is not the forum for it as this would be considered retail - and thats largely who the SEC, FSA and other regulators want to protect - the big guys are supposed to know what they are doing.

For anyone soliciting advice it becomes an interesting slope, and all the disclaimers in the world don't help if you are not authorised, or putting yourself out to offer expert advice.

On saying that you can find out plenty of information from other websites about setting up a fund.

Doing it professionally and properly costs money for accounts, audits, marketing, compliance (very intense), legal - dont forget once you take public money you will need contracts - handshakes might not do it. etc; and you have to deal with clients, and run the business as a business over and above the business of trading. Not for everyone.

I read somewhere that 50% of hedge funds (including ctas) go out of business due to operational business related issues rather than trading losses. You can have the best idea in the world but if you cant raise money for that idea then too bad.

You might want to team up with someone who has that experience but not the programming/trading skills.

Share this post


Link to post
Share on other sites

When I think of trading, I think of trading…

 

When I think of managing money

I think of

Compliance with a bunch of nit picky BS

Marketing, promotion, selling

Trading

Handholding ( / talking accts that really shouldn’t leave into staying and wishing accounts that should leave would, etc

Trying to attract talent and then delegate (what is essentially) trust

 

When I think of trading, I think of trading…

 

hmmm

Share this post


Link to post
Share on other sites

Exemptions from Registration

 

A person is not required to register as a CPO if:

 

He does not receive any compensation (direct or indirect) for operating the pool (other than reimbursement for ordinary expenses); and,

he operates only one pool at any time; and,

he is not otherwise required to register, or is affiliated with someone who is; and,

he does not do any advertising in connection with the pool.

 

OR

 

Total gross capital of all pools operated by the CPO does not exceed $400,000; and,

none of the pools has more than 15 participants at any one time (excluding the operator, CTA, or principal or related parties of the participants).

____________________________________________________________________

 

Any person exempt from registration as a CPO must disclose this fact in a written statement to all pool participants, along with the business name, address, and telephone number. This statement must be signed by a principal of the business. Two copies must be filed with the CFTC and one copy with the NFA within seven days after its first use or commencment of trading by the Pool.

 

Furthermore, CPOs which are exempt are required to:

 

1. Furnish each pool participant with monthly statements for the pool received from the FCM.

2. On each statement, clearly show the net profit or loss on all completed transactions since the previous statement.

3. Maintain all books and records relative to trading activities for 5 years, and keep such records readily accessible for review by the CFTC or the Department of Justice for the first 2 years.

 

If a person is exempt from registration as a CPO, but registers as such, he is subject to all rules governing CPOs.

 

Prohibited Activities

 

CPOs are required to operate the pool as a legally separate entity from that of the pool operator. Exceptions exist when:

 

1. the CPO informs the CFTC in writing that the pool participants will be issued stock in the pool (corporation) for all funds that the participant contributes to the pool;

2. the CPO proves to the CFTC that it has established adequate procedures to assure that pool funds are segregated from the pool operator’s funds;

3. if the CFTC, in all its wisdom, decides the CPO is exempt.

 

All funds received from pool participants must be received in the pool’s name, not the pool operator’s name.

 

No CPO may commingle funds from any pool he operates with funds from any other person or pool.

 

SO I GUESS I AM SAYING -WATCH OUT

The Pip Thief

Edited by The Pip Thief

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • i believe the min deposit is 50usd, except for wire transfer its 250. 
    • yes this is true, its not abattle of brokers (though a good broker should be chosen first) at the end of the day its the trader and his decisions
    • the fed reserve is sending mixed signals, it does affect crypto badly, im at a lose at the start of this year but i still have forex anyway haha
    • Yeah very strange name for a broker. To add my two cents I would also vote for Hotforex very honest broker with reliable platform. Filled my orders perfectly at yesterday breakout on Gold after the Fed meeting. 
    • Date : 26th January 2022. Market update – January 26 – Central Banks Eyed. It was a wild Tuesday in the lead up to today’s FOMC decision. Both bonds and stocks closed lower as the Fed is widely expected to outline a rate hike strategy with a 25 bp liftoff in March. Exaggerated fears of a 50 bp move and perhaps a string of 4 to 5 hikes this year have dissipated, though we suspect the markets are still positioned too bearishly. We expect the policy statement and Fed Chair Powell’s press conference to be less hawkish than anticipated, hence setting the markets up for a bit of a relief rally. So far today, Bonds have struggled, stocks hit the skids again in the US session but eased in the Asia session, and FX markets have remained in a narrow range as markets wait for the FOMC and BoC. Australia was on holiday, which made for somewhat lower volumes, but it was mainly the upcoming FOMC announcement that put a lid on markets. Ukraine tensions and speculation over gas supplies to Europe in case of an escalation of tensions with Russia are weighing on sentiment. UK PM Boris Johnson now has to answer the police over “partygate”, with calls for him to resign getting louder.   USD (USDIndex 96) continues incline – 3rd day above 20-DMA. The 10-year Treasury rate is up 0.4 bp at 1.773%. The 10-year JGB rate is also slightly higher, but the 2-year paper found buyers as the BoJ summary shows commitment to loose policy. – The bank’s stance focused on providing stimulus to reach the 2% inflation goal. Treasury’s $55 bln 5-year auction was super strong. Equities – The USA100’s -3.18% drop paced the weakness, followed by a -2.8% loss on the USA500 and a -2.3% decline on the USA30. Today, Topix and Nikkei corrected -0.25% and -0.44%, GER40 and UK100 futures are up 0.66% and 0.84% respectively, while the Euro Stoxx 50 is 0.7% higher. Earnings: General Electric, beat on earnings, but missed on revenue, which weighed heavily while American Express provided upside support on solid earnings led by record credit card spending. Microsoft beats expectations with $18.8bn profit. Central banks clearly are getting nervous about the risk of second round effects, but the IMF’s growth downgrades yesterday also highlighted the risks from slowing momentum in China and virus developments. USOil – up to $84.60 – API data shows US crude stocks fall,Biden threatens sanctions on Putin over any invasion, markets await Fed update, US approves oil exchange from strategic reserve. Yemen’s Iran-aligned Houthi movement launched a missile attack on a United Arab Emirates base hosting the US military. Gold – down to $1844 from $1854. Bitcoin at $37,000 handle. FX markets – USDJPY steady at 113.95. EURUSD at 1.1295 & Cable at 1.3500. European Open – Bund futures are under pressure, while US futures are moving higher, while in cash markets, the German 10-year Bund yield has lifted 0.4 bp to -0.08%. BTPs are supported though and spreads are coming in. Today – Along with today’s BoC and FOMC result, the earnings calendar is heavy. Today’s slate features several biggies, including Tesla, Abbott Labs, Intel, AT&T, Boeing, Anthem, ServiceNow, ADP, Lam Research, Crown Castle, Norfolk Southern, Freeport-McMoran, Progressive, Kimberly-Clark, Amphenol, Ameriprise, Corning, Nasdaq, Hess, Teradyne, Seagate, United Rentals, Raymond James, and Teledyne. Data includes the December advance goods trade report Biggest FX Mover @ (07:30 GMT) CADCHF – Breaks 0.7300 (R1) from 0.7195 lows on Monday. Fast MAs aligned lower intraday with all momentum indicators pointing further higher. Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.