Five Things Every Prop Trader Must Know

Big banks may be running from it as they attempt to streamline their operations, but there is still a lot of money to be made in proprietary trading.

Rob Friesen, President and COO of Bright Trading, LLC, recently sat down with Benzinga to discuss how one of his company's members overcame a bad break and made a million dollars. "We had a doctor that took a long time to learn the business," said Friesen. "As a merger trader, he worked hard, built his account up, but didn't take any money out. He was stuck in a merger -- remember the

/ Union Carbide merger that blew up? He was stuck in that thing, so he lost all of his money as well as ended up with a deficit to Bright Trading. "So he went into the office and said, 'What do I do now?' We said, 'What do you wanna do? You wanna walk away? We'll eat the loss. Do you wanna stay and save your career and work at it?' He said, 'I'll stay.'" The doctor made a smart move. After paying back all of his expenses -- as well as his deficit to Bright Trading -- he had net earnings of $1 million. Not all traders will be that successful, but everyone has to begin somewhere. To start things off right, Friesen has provided Benzinga with five key tips that every prop trader must know.