Quote:
Originally Posted by redrex003
My friend wants to take 20% of his own action, splitting profits 60% him 40% me for live 2/5nl. We're having trouble figuring out how makeup will work.
The scenario were struggling with is if Day 1 he loses $1,000, so I'm down $800 he's down $200 and then Day 2 he makes $1,000 how is this $1,000 profit split up?
If he makes $500 how does the makeup work? Does it all get paid back to me or is it divided somehow? Thanks.
Priority of claims can be whatever you want, but here's how I would do it. Your makeup has the highest priority, his makeup is second and profits are last. Therefore, if he loses $1000 on day one, you pay him $800. On day two, the first $800 goes to you and the next $200 goes to him. If he only won $500, all $500 would go to you, leaving him $300 in makeup to you and $200 to himself.
As mentioned by others, this isn't a good deal for you. Staking deals work best when they aren't between friends. Eventually with friends, they have to chose between their friendship and the money. It ends with someone being bitter about it.