Is the Futures Trading Risky?

[Joan Peter 10]

I am new to this futures trading, and I heard from my friends, that the commodity exchange is highly volatile and risky. Can any one brief about the risk factor since I am so interested in futures and want to start immediately.

[malcolm789 10]

Hi Joan, It is not as risky as your friends suggested. The futures markets are in one way reduces price risk for commodities. The futures market is competitive and complex by nature, but if you can understand the functions clearly, managing your funds is almost easy. Search for some websites, blogs, or books to know more about the trading basics and market terms. Well! I can suggest you to have a look at this blog Day Trading Futures | Online Future Trading | Trading Psychology - Expert Futures Trading , since the author is an experienced futures trader and offer valuable advice for traders.

[zdo 20]

Not under most conditions... Futures gets its ‘high risk’ reputation because losing traders tend to blow up faster in futures than in stocks from the ease with which one can over-leverage in futures.

If you really want to research it there are studies out there on the correlation between stock and future(s) volatility.

btw, these days you can go half way by using leveraged etf instruments

[Tams 20]

trading futures, like flying an airplane, or jumping off a bridge,

IS NOT DANGEROUS or RISKY:

people are doing it day in and day out,

some people even make a living out of it.

How can it be dangerous?

How can it be risky?

 

 

 

However,

trading futures, flying an airplane, and jumping off a bridge,

can be fatal if:

1. you are blindfolded,

2. don't have the proper training, and

3. don't have the right equipment/tools.

Edited August 26, 2009 by Tams

[JBWTrader 10]

Hi Joan Peter

 

In my opinion yes it is very risky (refer to Tams post)

 

If you put real money up now. You will defintely lose it all. I can guarentee this...

 

now advice from people can be very dangerous as ones belief system organises itself in such a way that can be very limiting for the time being.

 

Seriously use Sim trading to start in order to prove you edge. Read Journals like JonBig04 and learn what he has had to do to get where he is today...thats a great journal to see an eg of a struggle that has a lot of discipline to it....seriously read it all and dont speed read it..

 

There is a lot of great advice on here but dont trade it real until you have proven it to yourself. eg Db, Thalestrader, Brownsfan, Blowfish,Atto, etc a lot of great ideas on their take how the markets work. Focus on Price only.

 

I am deadly serious if you trade real lmoney off the bat for the first couple of years you will lose....no matter my advice you like everyone will dip the toe in the water and get smacked..but that is part of the learning too...

 

hang on your in for a bumpy ride...

 

good luck

All the Best

John

[Tams 20]

I am new to this futures trading, and I heard from my friends, that the commodity exchange is highly volatile and risky. Can any one brief about the risk factor since I am so interested in futures and want to start immediately.

 

 

p.s.

I am also interested in flying an airplane and want to start immediately.

Pls advise how.

 

 

;-)

[rigel 10]

1. Any business e.g opening a store is inherently risky, there are no guarantees it will be a profitable venture, more so, if necessary market research for the product, location etc , availability of materials, cost accounting etc has not been carried out.

 

2. Be under no illusion, like any profession, (where years of education, discipline and experience are required), trading futures is a fast way of parting with your cash if enough hardwork via education, testing etc has not been done. Just getting a computer, charting pack and datafeed is not enough.

 

3. Best way to get around is ask yourself simple questions:

Do you want to be an intraday trader , if so again there are numerous timeframes to work from ranging from a tick chart to hourly charts.

What are you risk tolerances

Are you well capitalised.

There are many more , get hold of some basic books

 

1. Principles of professional speculation by Victor Sperando

2. Techniques of Tape Reading by Vadym Graifer

3. High Probability Trading by Marcel Link

4. Day Trading Tactics by Josh Lukeman

5. Reading Price Charts by Al Brooks

 

In short learn the business, give yourself a couple of years at least for this process.

Best of Luck

[JBWTrader 10]

Hey Tams

I could show you how to crash it mate !! lol...

Best

john

 

p.s.

I am also interested in flying an airplane and want to start immediately.

Pls advise how.

 

 

;-)

[Tams 20]

Hey Tams

I could show you how to crash it mate !! lol...

Best

john

 

 

would it be easier if I learn to fly and jump off the bridge at the same time?