Beginning to Trade
I started trading - mainly self-taught - when I was studying Computer Science at King’s College London. After a couple of years trading in the futures markets - like SP500, Bund and FX - and some blown accounts, I eventually began to gain some consistency.
After graduating, I traded for a prop firm in the City of London and started to program my strategies into Algos.
I then thought about setting up my own firm… and this is how BluFX started!
Starting Blueprint Capital
I set up Blueprint Capital as a prop trading firm in London in 2013.
Initially, we only interviewed experienced traders. They were confident, bold and had a proven track record. But they didn’t perform as well as we’d hoped, and losses were consistently made.
So, how could we fix this? We tried many different avenues...
1. Using demo accounts
We asked our traders, even the experienced ones - to sit in a demo account for two to four weeks to measure their performance. Then we backed only the traders that made a profit on the demo.
But once they switched back to the live accounts, we found the same issues with loss.
It was time to try something else.
2. Asking traders to use their own capital
We decided to stop backing traders fully and, like most other prop firms, asked them to contribute some of their own capital alongside ours.
But this didn’t seem to work either. I quickly realized it was time to re-write the business model completely. Best traders didn’t necessarily have the funds to live off and trade for the months required.
So how could we change the prop trading model to work for both the firm and the traders?
The Future Of Prop Trading
I realised we could start from scratch to create a brand-new type of prop trading firm.
We spent a long time analysing the benefits and issues that the traditional prop model posed to both traders and firms - assessing everything from unstable incomes to trading restrictions, evaluating factors like high running costs and career progression opportunities.
After months of research, an exciting new model started to take shape in my mind - one that was based on equal opportunities and built for traders by traders.
- ✓ More accessibility: we wanted to reduce the monthly fixed cost for traders to make it as accessible as possible
- ✓ More flexibility: our aim was to recruit talented traders globally, not just in London - so subscribers can trade remotely
- ✓ Fairer barriers to entry: traders can be fully backed by us without any screening process; no background, wealth, education, class, nationality barriers, profitability is the only proof needed,
- ✓ Easier processes: we wanted to create a platform that was easy to access for part or full time traders. The subscription model offered a perfect solution if it could be adapted.
- ✓ More freedom: our goal was to create a diversified trader portfolio so that users can implement their own trading strategies without many restrictions
- ✓ AI risk management: we would need to be able to manage the trading risk dynamically to maximise profitability
- ✓ Transparent career paths: we wanted clearer paths for traders to progress with us
- ✓ Instill professional trading habits: we wanted to introduce professional trading habits and behaviours to retail traders
I believed the model above could revolutionise the traditional prop trading industry. So - we began our exciting journey…
I built a team that included an ex Hedge fund and investment banking prop trader with decades of experience as well as a market maker and liquidity provider to the retail brokers.
After a year of hard work, our first trading software was launched in 2015. With a built-in risk management system, our trading software allowed users to trade six major FX pairs.
In the first month of launching, we had over fifty traders - and reduced the monthly cost for traders from £3000 to £325.
In 2016, we launched our web-based trading platform which further enhanced the trader’s experience.
We also upgraded our risk management system and removed many of the old-school rules and pre-screen processes.
We replaced the old-school rules and approaches with a new set of risk parameters based on transforming retail traders into professional fund managers. Central to this was the reduced use of leverage. We also introduced innovations like a monthly payday, set trading hours and growth targets set at levels based on vast amounts of trading data. Simply put we created an environment geared for maximum success yet at a lower cost than the traditional retail broker journey.
With that, our client base grew from 50 to over 500 users.
We rebranded the project as BluFX and, after listening to trader feedback, adopted the MT4 based trading platform.
We also added overnight trading, trader growth path and further reduced our monthly subscription prices to £249 (Pro) and £99 (Lite).
We now have over 2000 traders from over 60 countries globally.
We went from “to good to be true” and lots of scepticism to a well-known brand that has revolutionised the prop trading world and redefined trading in the FX industry - and there are plenty of innovative developments ahead!
Thank you for joining us on this exciting journey!
Yu Song, CEO