If PROP Desks decides to trade against their clients, are they not risking themselves?

A common allegation against discount brokers in general is that they have a PROP Desk which either sells client position data or trade against their own clients.

This is normally substantiated by individual day-traders claiming that their stop losses are often targeted by discount brokers.

In this scenario.

Suppose, a PROP Desk decides to trade against their client position, Are they not risking themselves by taking a trade by not following any analysis.

Isn’t there a chance that, even their position will be eaten by some other bigger shark with a bigger table, even smarter than them.

Whats your thoughts on this ?

I think not because the odds are in their favor as nearly 95% of the retail day trader lose money. Easy money for the brokers.

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Woah! This sounds scary! Is this even legal? I mean won’t it become “conflict of interest” ?

I had bookmarked this post. Hopefully this should answer your query.


They are competing with the market participants. each broker has his own book which cannot represent the entire market.

It would downright foolish if any authorized broker did this.

However , this happens all the time with bucket shops like those FOREX brokers. They do this all the time. They have algos to do this. This why they give very high leverage and bonus to attract fools.


This is from ET live blog, where all the so called “experts” give their views on the market after it is closed.
This particular expert has been saying stay away from market from the same levels when the market was trending up and touched all time High! If this expert is “doing” what he is “saying/advising”, then I think you need not worry at all about the advantages proprietary desk of a brokerage firm has over and above retailers who trade with them!

PS: What baffles me more is a Head of Trading gives advice on Investing. but that seems to be the norm so I will just ignore the irony!


I guess Market is always bigger than any analysts…time and again people have tried to predict market with least success and with least consistency…


March 20th: [NIFTY at 10124.35] “We would recommend entering fresh positions at this juncture
March 27th: [NIFTY at 10184.15] “we would advocate not entering fresh shorts at the current juncture.

These Expert Views change faster than NIFTY levels!

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There are many ‘experts’ in the market and more or less they don’t know what they are talking about. These ‘views’ that we come across are just statements made by them without much of the thought.