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TopstepTrader's Michael Patak (Founder) - Ask Me Anything (AMA)


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TopstepTrader's Michael Patak (Founder) - Ask Me Anything (AMA)

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  #1071 (permalink)
Atlanta
 
 
Posts: 120 since Jan 2017
Thanks: 34 given, 63 received

How is Topstep Trader legal?

I'm in a conversation about trading someone else's money as a contractor vs as a limited partner?

This also evolved into the question are Topstep Funded Accounts really live?

Are the Topstep Funded Accounts more like Leeloo accounts where they use Leader/Follower algo to copy trades, then executie them into the live market? Which means TST gets to remain legal because Funded Traders are Signal Providers and not legally trading TST live accounts?

Why not let Funded Traders join the firm and become K1 for tax savings?

The above are questions that TST execs should answer?

Funded traders, have you verified if TST is really live? How have you done so?


Thank you--- Just looking for transparency of what is really going and how is all this legal.

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  #1072 (permalink)
Site Moderator
Sarasota FL
 
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MichaelFlowTrader View Post
How is Topstep Trader legal?

I'm in a conversation about trading someone else's money as a contractor vs as a limited partner?

This also evolved into the question are Topstep Funded Accounts really live?

Are the Topstep Funded Accounts more like Leeloo accounts where they use Leader/Follower algo to copy trades, then executie them into the live market? Which means TST gets to remain legal because Funded Traders are Signal Providers and not legally trading TST live accounts?

Why not let Funded Traders join the firm and become K1 for tax savings?

The above are questions that TST execs should answer?

Funded traders, have you verified if TST is really live? How have you done so?


Thank you--- Just looking for transparency of what is really going and how is all this legal.

Obviously, @TopstepTrader will need to be the one answering these questions. I'm not part of TST and I can't speak for them.

But I am completely puzzled by your major question, which is whether TST is "legal". Why is this a question?

Trading firms, of which there are a great many, employ people to trade their funds. I have no doubt that sometimes their traders are contractors and not direct employees or partners. How would a trader being a contractor create a situation that is not legal??? And how would it be unusual, rather than the normal routine?

The rest of your questions I'll leave for TST (and this one too, of course), but it is totally puzzling why you would think that hiring contract traders is not legal. Inquiring minds want to know.

Bob.

When one door closes, another opens.
-- Cervantes, Don Quixote
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  #1073 (permalink)
Hatyai /Thailand
 
Experience: Beginner
Platform: Sierra Chart NT
Trading: ES
 
Posts: 120 since Jul 2018
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canoekoh View Post
once you're funded with TST, let's say you make $9000 in profit without ever withdrawing. then you happen to mistakenly place a trade during FOMC and you're immediately flunked out of the Funded account.

are you still able to withdraw that $9000 or do all profits you made in a funded account just vanish into thin air once you break a rule in the Funded account?

@canoekoh

Great question.

Did you get any response as yet?

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  #1074 (permalink)
Chicago, IL
 
Experience: Advanced
Platform: TSTrader, NinjaTrader...
Trading: ALL- Futures, Forex, Equities
 
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Posts: 246 since Feb 2013
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4tison View Post
@canoekoh

Great question.

Did you get any response as yet?

@canoekoh @4tison
Hi all! To answer your question, any profits earned in the Funded Account are your profits to keep regardless if you break a rule or not.

If you have any questions about our products or services at TopstepTrader, please send me a Private Message or use the FIO "Ask Me Anything" thread.
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  #1075 (permalink)
Atlanta
 
 
Posts: 120 since Jan 2017
Thanks: 34 given, 63 received

Could you answer my questions as well. Please

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  #1076 (permalink)
burlington, vt
 
Experience: Advanced
Platform: Sierra
Trading: NQ
 
Posts: 197 since Aug 2015
Thanks: 85 given, 390 received

Good morning,

I just have a few questions, as I'm considering splitting my trading capital into a prop environment. Just a few small things are unclear for me with TST.

1. After passing your $100k-$150k nominal combine, will the initial drawdown of the live account be the same rates of the combine? I ask this because my style of trading wouldn't be suited for tighter dd.

2. Regarding the trailing drawdown, from what I've read it is calculated end-of-day on the simulated accounts. What about live accounts? I'm a little concerned that trailing drawdown will follow the equity highs rather than closed trade equity.

3. Regarding hours permitted, it is clear that positions need to be closed at the end of the session. If trading globex hours, do they need to be closed/reopened at the RTH session start? for example, having a ES trade open at 7am CST through the 8:30am opening minute.

4. When moving from stage 1 to 2, are we required to pay again? or does the original monthly fee already paid for continue on?

5. I'm not really clear on the differences between the 'Pro account' and the normal path, when passing your 2nd stage. Would you mind elaborating on the benefit of going with a 'Pro account'?

6. How is size increase dealt with on live accounts? Is there a pre-defined risk scale increase or do we have to re-negotiate often?

7. I'm currently not used to paying Pro prices for data costs, and would be eating $400+/month if joining your firm. Is there any data cost reduction in any form, such as using the TST platform or anything?

8. Does your backer accept those with recent live track records, as opposed to doing months of a combine?

If anyone knows the concrete answer of any of these, feel free!

Thank you for your time

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  #1077 (permalink)
Antwerp
 
 
Posts: 454 since Jun 2016


karentrader View Post
Good morning,

I just have a few questions, as I'm considering splitting my trading capital into a prop environment. Just a few small things are unclear for me with TST.

1. After passing your $100k-$150k nominal combine, will the initial drawdown of the live account be the same rates of the combine? I ask this because my style of trading wouldn't be suited for tighter dd.

2. Regarding the trailing drawdown, from what I've read it is calculated end-of-day on the simulated accounts. What about live accounts? I'm a little concerned that trailing drawdown will follow the equity highs rather than closed trade equity.

3. Regarding hours permitted, it is clear that positions need to be closed at the end of the session. If trading globex hours, do they need to be closed/reopened at the RTH session start? for example, having a ES trade open at 7am CST through the 8:30am opening minute.

4. When moving from stage 1 to 2, are we required to pay again? or does the original monthly fee already paid for continue on?

5. I'm not really clear on the differences between the 'Pro account' and the normal path, when passing your 2nd stage. Would you mind elaborating on the benefit of going with a 'Pro account'?

6. How is size increase dealt with on live accounts? Is there a pre-defined risk scale increase or do we have to re-negotiate often?

7. I'm currently not used to paying Pro prices for data costs, and would be eating $400+/month if joining your firm. Is there any data cost reduction in any form, such as using the TST platform or anything?

8. Does your backer accept those with recent live track records, as opposed to doing months of a combine?

If anyone knows the concrete answer of any of these, feel free!

Thank you for your time

1. Yes

2. In the Funded Account, this rule is calculated intraday, which means if the balance falls below the minimum account balance you will be pulled from your trades right away and the rule is considered broken. The question remains, does the trailing drawdown rises with every trade or just at the end of the day. Best to ask TST directly.

3. All positions must be closed prior to 3:10 PM CT, you can restart trading at 5:00 PM CT until the next day 3:10 PM CT. There are products that have different closing times (Agricultural futures).

4. The original monthly fee continues every month until you have passed stage 1 and 2.

5. https://info.topsteptrader.com/understanding-the-pro-account

6. https://help.topsteptrader.com/hc/en-us/articles/360000140787-What-is-the-scaling-plan-

7. As far as i am aware there is no way to avoid the exchange fees with TST.

8. Never heard of anyone being accepted without doing a combine, so i would guess not.

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  #1078 (permalink)
Chicago, IL
 
Experience: Advanced
Platform: TSTrader, NinjaTrader...
Trading: ALL- Futures, Forex, Equities
 
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Posts: 246 since Feb 2013
Thanks: 57 given, 690 received


karentrader View Post
Good morning,

I just have a few questions, as I'm considering splitting my trading capital into a prop environment. Just a few small things are unclear for me with TST.

1. After passing your $100k-$150k nominal combine, will the initial drawdown of the live account be the same rates of the combine? I ask this because my style of trading wouldn't be suited for tighter dd.

2. Regarding the trailing drawdown, from what I've read it is calculated end-of-day on the simulated accounts. What about live accounts? I'm a little concerned that trailing drawdown will follow the equity highs rather than closed trade equity.

3. Regarding hours permitted, it is clear that positions need to be closed at the end of the session. If trading globex hours, do they need to be closed/reopened at the RTH session start? for example, having a ES trade open at 7am CST through the 8:30am opening minute.

4. When moving from stage 1 to 2, are we required to pay again? or does the original monthly fee already paid for continue on?

5. I'm not really clear on the differences between the 'Pro account' and the normal path, when passing your 2nd stage. Would you mind elaborating on the benefit of going with a 'Pro account'?

6. How is size increase dealt with on live accounts? Is there a pre-defined risk scale increase or do we have to re-negotiate often?

7. I'm currently not used to paying Pro prices for data costs, and would be eating $400+/month if joining your firm. Is there any data cost reduction in any form, such as using the TST platform or anything?

8. Does your backer accept those with recent live track records, as opposed to doing months of a combine?

If anyone knows the concrete answer of any of these, feel free!

Thank you for your time


Hi there! Thank you for your questions.

To start, while in a Funded Account is very similar to the way the Daily Loss Limit is calculated intraday in the Combine, once in the Funded Account, the Weekly Loss Limit, and Trailing Max Drawdown are also calculated intraday (based on unrealized P&L). This means if you reach one of these limits at any point during the trading day, you will break a rule and you will be locked out of your account immediately. Check out the comparison here.

Second, all positions must be closed prior to 3:10:00 PM CT. For a list of permitted products and when you can trade, check out this article

In addition, your monthly subcription consolidates the lifetime of your active Trading Combine (Step 1 & Step 2). For more information on the subscription model, read more here.

As for the Pro Account, this option comes with a number of benefits. It provides the same opportunity to earn from your trading as the Funded Account®, but allows you to adapt to trading for real money in a familiar, simulated environment. To watch an explanation video, check this out. One major benefit of the Pro Account that addresses another one of your questions, is the Pro Account has no platform fees, or data exchange fees.

Lastly, to unlock your Funded Account, you must complete the Trading Combine. We encourage traders with a very succesful trading history to join our program. The reason why we require users to enter in our program is to prove to us that you can demonstrate profitability and risk management. For more enlightment, check out this article.

I hope this answers all or some parts of your questions. As always, please reach out to our support team for any questions or concerns!

If you have any questions about our products or services at TopstepTrader, please send me a Private Message or use the FIO "Ask Me Anything" thread.
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  #1079 (permalink)
Chicago, IL
 
Experience: Advanced
Platform: TSTrader, NinjaTrader...
Trading: ALL- Futures, Forex, Equities
 
TopstepTrader's Avatar
 
Posts: 246 since Feb 2013
Thanks: 57 given, 690 received


bobwest View Post
Obviously, @TopstepTrader will need to be the one answering these questions. I'm not part of TST and I can't speak for them.

But I am completely puzzled by your major question, which is whether TST is "legal". Why is this a question?

Trading firms, of which there are a great many, employ people to trade their funds. I have no doubt that sometimes their traders are contractors and not direct employees or partners. How would a trader being a contractor create a situation that is not legal??? And how would it be unusual, rather than the normal routine?

The rest of your questions I'll leave for TST (and this one too, of course), but it is totally puzzling why you would think that hiring contract traders is not legal. Inquiring minds want to know.

Bob.

Hi there! To answer your questions as concisely as possible:

In our Funded Accounts the traders are brought on as independent contractors that each place their own discretionary trades in the sub account designated to them.

If you have any questions about our products or services at TopstepTrader, please send me a Private Message or use the FIO "Ask Me Anything" thread.
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  #1080 (permalink)
Site Moderator
Sarasota FL
 
Experience: Intermediate
Platform: Sierra Chart
Trading: ES, YM
 
bobwest's Avatar
 
Posts: 5,721 since Jan 2013
Thanks: 44,653 given, 19,316 received



TopstepTrader View Post
Hi there! To answer your questions as concisely as possible:

In our Funded Accounts the traders are brought on as independent contractors that each place their own discretionary trades in the sub account designated to them.

@TopstepTrader, thank you, but I did not have any questions at all. I was quoting someone else, @MichaelFlowTrader, who did have some questions, including one about independent contractors.

My response to him was basically that I was puzzled that anyone would have one of the questions he was asking, about whether using contractors was somehow not legal. Just to be clear, I have stood up for TST on this forum for many years, and do not have any such issues about your program or practices.

Somehow you may have misunderstood my post, but it does not contain any questions for you.

However, @MichaelFlowTrader has still not received a response from you, and he has asked for one in a follow-up post, so you might want to address his questions directly. He had a number of them, besides the one about contractors.

Bob.

When one door closes, another opens.
-- Cervantes, Don Quixote
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