We were going to answer common questions about prop trading firms but since most are different we have selected one of the most reliable and well known prop trading firms to go over common questions.
Prop Trading Firms allow traders to day trade without having the 25k equity required by the SEC to participate in day trading. We want to go over a recent partnership we have taken on and answer the most common questions about this Prop Trading Firms.
Day Trade with $5,000
We have recently partnered with a trading firm that will give you $50,000 buying power with only $5,000. This is the only way to Day Trade with less than 25k. The way this is set up can get you around the 25k equity required to Day Trade. When you join our Partnered Prop Trading Firm you will have the option to get a FREE 1 hour trading lesson through skype and a coupon code for a FREE annual subscription to our sister site Picks That Make Cents.. We are offering you this when you sign up to insure you have the knowledge and tools required to beat the market on a daily basis. If you have ever wanted a day trading job this is your chance to do so……
Frequently Asked Questions
Q: How much are the commissions at your partnered Trading Firm?
A: There are no commissions at our partnered trading firm. So the direct answer is $0.
Q: If there are no commissions then how do they make money?
A: You will pay $175 a week to have access to the capital with the ability to do an unlimited number of Day Trades. If you calculate 5 trades per day (Full turns, so buy and sell) at $7 per trade that puts you at $350 per week. This actually saves you money.
Q: Are there any other fees I need to know about before I join?
A: Yes, there are a few other cost involved. You will pay $130 a month for a software platform to place your orders. There are also ECN fees that you will pay at cost which are minimal. When you mention you heard about them through best-free-stock-picks.com they will forgive the data feed fee all together. So mention us and save $30 a month.
Q: Who holds my funds and how do I access them?
A: Individuals who choose to join WTC’s trading group are hired on as independent sub-contractors to trade firm capital. Trader funds are considered membership deposits and are used to offset an accrued trading losses, trading fees, and membership fees. Traders have access to funds, which are held in WTC’s FDIC-insured corporate checking account, at any time by submitting a secure Withdrawal Request form available via the WTC website (www.wtctrading.com). WTC does not employ any capital “lock-up” periods on trader membership deposits.
Q: What type of technology does the firm offer for trading?
A: WTC uses Sterling Pro (www.sterlingtrader.com) for all of its traders. This platform offers full DMA (Direct Market Access) with level 2, streaming news, unlimited charting, stock watch lists, etc. Additionally, Sterling offers several add-on programs that can be used to supplement the front-end product. WTC’s traders have access to the following ECNs and ATSs (Algorithmic Trading Suites):
EDGA XFINDER (Credit Suisse)
EDGX UBS AGG/PASS
Q: How do I track all my trading activity while with the group?
A: WTC uses a 3rd-party middleware provider called PropReports (www.propreports.com) to partition out all trading activity for its individual traders. Via this service, which is included in the monthly membership fees, traders are able to run advanced reports to view all aspects of their trading activity, including trading fees, Gross and Net P&L, daytrade activity, and ECN usage. WTC has setup a demo of PropReports via the following page, http://www.wtctrading.com/trading_tracking.php. For a more in-depth explanation of PropReports, please call 1.866.473.5069 or email WTC with questions at firstname.lastname@example.org.
Q: Am I limited to 3 intraday trades per week or can I place an unlimited number of weekly trades?
A: The SEC’s Pattern Daytrading Rule in a nutshell states that traders must maintain a balance of $25,000 to be able to make more than 3 intraday trades each week. As a trader with WTC, you are trading on behalf of their firm, which maintains an account with a minimum balance of $250,000 at its designated clearing firm, ETC (www.etc-clearing.com). Since this account qualifies for pattern daytrading, all WTC traders are able to trade UNLIMITED throughout the week with BUYING POWER being released immediately once a trade has been closed out.
Q: Does WTC have any RULES/GUIDELINES that I’ll need to follow that might interfere with my style of trading?
A: WTC does employ an initial set of trading guidelines and some minor “introductory” rules/guidelines so help traders ease into the new trading environment, but nothing that will be too restrictive. For example, most traders for WTC will be restricted to a 5:1 or lower ratio for intraday buying power during the first 1-2 weeks of trading. The firm also encourages diversification of positions to avoid over concentration risk. However, if you’ve been trading for awhile and have a specific strategy that you’re interested in using, I would encourage contacting Dave Babich at 206.219.9265 or calling the firm’s toll free # 1.866.473.5069 to discuss this as they are willing to work with traders on a case-by-case basis to remove some of these initial restrictions. Once past the initial buying power “testing period” most traders are able to apply their own strategies in full force.
Q: I trade a lot of OTCBB and Pink sheet/Penny Stocks. Does WTC allow this and can I use all my buying power for this?
A: The firm does allow its traders to trade OTCBB and Pinksheet stocks using firm capital. However, due to margin requirements and greater liquidity risk, buying power is restricted from the normal 10X to 2X cash for these trades. WTC offers a FREE route in CITI for trading of OTCBB and Pinks.
Q: Are there any other fees I need to know about before I join?
A: Since there are NO COMMISSONS with WTC, they simply pass-through clearing related trading fees including SEC, Clearing, TAF, NSCC, and NSDQ fees. For the most part, these fees amount to a fairly small amount and all fees are itemized in full via PropReports, the firm’s 3rd party tracking software. All fees are fully disclosed by WTC prior to initiation of live trading.
Q: Does the firm pay out ECN rebates when using LIMIT ORDERS?
A: WTC traders receive between 40% and 100% of ECN rebates when adding liquidity with true LIMIT ORDERS. ECN rebates will vary depending on the route. For example, EDGX is the most aggressive at paying out ECN rebates at $.0029/share ($2.90/1000 shares). So, let’s assume someone trades 1 million shares and adds liquidity with limit orders 50% of the time for a total of 500k shares at $.0029 = $1450 *40% = $580 REBATE. ECN rebates are calculated on a daily basis and available via PropReports.
Q: What am I charged for using the various ECNs and ATSs when removing liquidity with MARKET ORDERS?
A: When traders remove liquidity using either a MARKET order or a MARKETABLE LIMIT order, they are assessed an ECN pass-through fee by the designated routes. For example, if someone were to BUY 1000 shares of Microsoft using ARCA, they would be charged $3.00 or $.003/share by that route. It is important to factor these fees into your trading game plan and understand how they will affect your bottom line. For more information about the various routing options provided for WTC traders, please call 1.866.473.5069 or email email@example.com.
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