Prop Shop

Our LARP (live-action role playing game) group likes to meet at a nearby abandoned old farm for our quests and battles. It’s a great location—no neighbors complaining about weird noises or strangely-dressed people carrying swords. And even better, it’s got an old shed on site where we keep extra shields, cloaks, face paint, and other LARP accoutrements. We call the shed the “prop shop,” and that is absolutely not what a prop shop is in the financial world.

A “prop shop” is basically a small brokerage firm that uses its own capital in its trades and investments. The “prop” is short for “proprietary,” and the “shop”...isn’t short for anything. But, in a nutshell, here’s how it works: prop shops are usually owned and operated by one or very few individuals. All trades and investments are made at their discretion, and if we want them to use that discretion to our advantage, we’ll need to pony up our own money (no investment loans here) and pay an entry fee.

Investing with prop shops is usually considered quite risky, since one bad trade or investment could spell financial disaster. But, on the other hand, one good trade or investment could make us a ton of dough, which is why prop shops can be so very appealing to the non-risk-averse investor.