Originally Posted by t3hcardshark
a series 3 is the options/futures/commodities license. If you were to be a financial adviser for stocks/mutual funds/etc. you would have series 6/7. Ideally what he is proposing is to be an investment manager handling your forex portfolio. Depending on where he is located he may need to be registered with a regulatory body to legally trade client funds. If he is registered and has done all this, then he's obviously serious about it.
If he did have a 600% roi last year though, he should be able to provide a trail, give you figures on his successful trades vs failed trades, etc. Things I would want to know would be:
Largest successful trade
Largest failed trade
# of trades
# of profitable/losing months
If he took a huge gamble and spiked 75k on a single, heavily over-leveraged trade, and then was effectively break-even the rest of the year, I would be leery. If he was profitable 11/12 months and looks to be trading smart, then you're good to go.
In a poker sense, do you want to stake the guy that is bleeding cash left and right for 11 months then binks the sunday million, or do you want to stake that guy that is consistently making 10k/mo.
I'm definitely not saying do it or don't do it, simply "know what you're getting into" before you do it. If he doesn't want to provide you with any of that info, then fold and look for a better spot to shove.
although i think it is very intelligent to look through his trading strategy and try to gauge what is risk level is at all times and think how well it went for him objectively and also ask for his reasons behind certain trades.
i wouldn't mind at all if there were a few big winners and lots of small losers. actually i think i would prefer that.
people's minds prefer consistent small wins so much that i think these trading grounds are more efficiŽnt and also there is no way to tell if the BIG BIG loss is just lurking in the waters at all times. I mean merger arbitrage is an example of this strategy. It works often but the time it don't work you get murdered.