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Guest rwalkerx

Why I prefer to trade e-mini futures over STOCKS!

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Guest rwalkerx

Here are some very compelling reasons why we prefer to trade e-mini YM to stocks (off the top of my head).

 

-I can day trade without needing $25,000+ in the account! I have two accounts with about 10K in them.

-Comissions are decent $4/round turn trip on the YM

-Tax Reasons - You don't have to list every sale on your return! (for people in the USA)

-It's liquid enough. Market orders are instant. No weird fills

-The spreads are never going to be huge like they can get on stocks

-Focusing on one instrument day in and day out is less complicated and more productive

-I can sleep in! As I dont have to wake up at 6am and scan for stocks to trade

-Share size allocation is easier. I trade from 3-8 contracts depending on the setup

-I've held a stock that plunged 20 pts due to random company event. While econ reports move the futures. It's never been THAT bad!

-There are always shorts avilable!

-Comissions are reasonable (I pay around $4.10/round trip)

-No uptick rule (not that its going to be lasting too much longer)

-The $5/tick range of the YM makes for lower slippage(ES, ER too volitale=bad slippage)

 

I started day trading again a few years ago with stocks. I lost money pretty cosistantly..then I joined an e-mini trading group that focuses on the YM.. on my bad weeks I break even. This is fine with me, I was used to losing 2k a day!

 

Anyway. If your new I think you should concentrate on one thing and not jump all over the map! just my 2 cents..

 

If anyone has any more reasons to add, then feel free!

 

RW

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Interesting. Philly boy, eh ? Who were you daytrading through in the Philly area...just curious....as I am located in the area.

A friend of mine who lost in daytrading, has a similar success story...he came back using options.

It appears that the pressure-to-trade in the daytrading arena is one big source of blow-ups and losses.

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Ya, I don't think it is possible for them to introduce the uptick rule. The futures market (which is a true zero sum game) may not function properly, and I highly doubt they would implement the rule just to test it out, to simply 'see' if the rule did anything good for the market.

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The thread starter's comment as regards the uptick rule wasn't that futures trading was going to get hit with it but instead that it was likely to be eliminated sometime in the foreseeable future from stock trading.

 

I recall having read that myself in a couple of places other than forum threads in the past few months. So, while it may have some merit, I don't know anyone that could put any realistic deadline to it.

 

Happy Trading :)

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  ezduzzit said:
The thread starter's comment as regards the uptick rule wasn't that futures trading was going to get hit with it but instead that it was likely to be eliminated sometime in the foreseeable future from stock trading.

 

I recall having read that myself in a couple of places other than forum threads in the past few months. So, while it may have some merit, I don't know anyone that could put any realistic deadline to it.

 

Happy Trading :)

 

 

Finally I could start shorting Halliburton quickly. Let's wait and see.

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  The Bear said:
Finally I could start shorting Halliburton quickly. Let's wait and see.

 

That's too funny! I remember shorting Haliburton once with a market order and getting filled thirty cents lower than where I intended because of the uptick rule.

 

Needless to say, the trade was a loser.

 

Ah, the lessons...

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That's funny. That would happen to me too. It would happen with my stop orders too...so buy to cover on shorts.

 

My stop would get hit and my market orders would just sit there. Sometimes 30 cents later I would get filled. It was a joke. I picture some specialist named vinny laughing down at the post and he sees our orders just sitting there.

 

I used to be a chronic short seller of HAL. Those days are long over though.

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i think the comment about the futures market vs. equities market and zero sum game etc. by Bear is spot on

 

the futures market is not a market of "stuff" like the stock market is. it's a market of "contracts" which are simply agreements.

 

a very big part of the futures market is commercials doing hedging (producers and consumers of goods), and in order to serve its purpose, it has to give "equal access" to both sides of the commercial game, not to mention speculators.

 

if coke wants to lock in (what they see as a low) sugar price, they go long sugar contracts, and that means that any gain in sugar price will not hurt them, since their long contract will offset the additional costs of buying sugar for their product.

 

and a sugar producer goes short of course, to hedge the price of his sugar that is in storage, or waiting to get processed, etc.

 

purposes like this are why the futures market was INVENTED in this country, and others (we weren't the first.)

 

the stock market has a limited # of shares for each company, however the futures market can have unlimited # of contracts outstanding (called open interest). heck, you could have only ONE person long and one short the dow futures, or 10,000,000 long and 10,000,000 short because the contracts are merely agreements created out of thin air.

 

the stock market otoh, is not a zero sum game, and is not structured to be a free flowing shorts vs. long market.

 

so, personally, i have no problem with the stock market uptick rule. it would be insane (and nobody believes it would be instituted) in futures

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I think there are many more interested parties in seeing stock prices rise. Thus they want to make it harder for prices to fall. There is no good reason to have curbs, unless you want to make it more difficult for the market to fall.

 

Futures still have a sense of being instruments for professionals. Many people still argue that the retail person should not even be involved in the derivatives side of the game.

 

The "experts" point to the fact that a futures contract can trade lock limit down or be shorted on a down tick as reasons they are only for the sophisticated monied player. But the stock market is for everybody. As long as you put your money in and leave it there for the long run.

 

Do you think analyst disclosers are a good thing? Then why weren't they a good thing before the bubble burst? A "sale" call by the street is still rare.

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