It's good to note too that if you really have the skills, you can work for yourself. You don't need to impress someone enough to have them hire you on. Real ability is rare and very valuable so if you can learn that you'll be fine.
What a shop will gain you is a larger pool of capital to work with, so you're open to safer strategies that may only net say 1-5%/mo. (the higher the return the higher the risk, so if you're doing a high risk/reward strategy, the only way to not completely bankrupt is to quit at some point before you blow up, which almost everyone cannot do).
There are a number of ways to pull 1-5% mo. out of capital, which doesn't make it worth the time unless you're well capitalized, so it can make sense to get with a firm, but keep in mind if you have the skills, you don't need to go impress anyone. Your record will speak for itself.
Very good point. Just beware that you need to have a minimum of 25k (not including the money you are trading with) to get around the pattern day trader rule. If you don't have the 25k then you must wait for 3 days for your cash to clear after exiting a trade. This greatly reduces the number of trades you can do and your strategy. You may want to exit a trade after gaining 10% in one day but then that money will be tied up for 3 days. If you have a total of 5k you can kind of split it up into 1k trades so you can still make a few trades until those 3 days are up.
It's good to note too that if you really have the skills, you can work for yourself. You don't need to impress someone enough to have them hire you on. Real ability is rare and very valuable so if you can learn that you'll be fine.
I don't agree. If you trade $25k of your personal capital up to $35k, that's not going to impress a fund enough to hire you if it otherwise wouldn't. You could have gotten lucky. It doesn't prove that you understand markets or the effects of large trades ("slippage") or the game theory and microstructure. If you lose that money, well now you're out by an amount that would be a fair chunk of change for most people.
What a shop will gain you is a larger pool of capital to work with
And relationships and experts that make transaction costs and taxes low, and the ability to colocate and shave milliseconds off your execution time (milliseconds matter; even microseconds matter, these days), and smart people to learn from.
My point was not to trade your own in the hopes of getting hired.
Don't try to impress people, or even try to get hired on.
Instead, the goal (should be) to make yourself so undeniably talented that they are trying to impress you to work with them. That may not happen, but if you're really talented, you will make money. You can learn on your own. Takes years, but most of what people "have to teach you" in this area is bullshit anyway.
I agree with your statements. Although, relationships mean nothing (except in service of getting more capital). Mentors can be good. Costs are critical and you can get pretty low on your own, although not as good as HFT - buy why try to even compete there? HFT is not the only game in town however.
What a shop will gain you is a larger pool of capital to work with, so you're open to safer strategies that may only net say 1-5%/mo. (the higher the return the higher the risk, so if you're doing a high risk/reward strategy, the only way to not completely bankrupt is to quit at some point before you blow up, which almost everyone cannot do).
There are a number of ways to pull 1-5% mo. out of capital, which doesn't make it worth the time unless you're well capitalized, so it can make sense to get with a firm, but keep in mind if you have the skills, you don't need to go impress anyone. Your record will speak for itself.