Advantages to Trading Futures vs Stocks!

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Old Nov 23, 2006, 11:13pm   #1
 
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Advantages to Trading Futures vs Stocks!

Here are some reasons my colleagues and I prefer e-mins to stocks (off the top of my head)....

-Futures are always liquid enough. Market orders are instant
-The spreads are never going to be huge like they can get on stocks
-I have two accounts with about 20K in them. I can day trade without needing $25,000+
-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 (you can short on a down tick)


I started day trading again two years ago with stocks. I lost money pretty cosistantly..then I switched to e-mini YM.. at first I broke even for awhile (hey thats decent entertainment) then I joined a group of futures pros and watched for a month.. slowly but surely... I became able to trade on my own without chasing everything out there. Im still in that group but I can see signals on my own. Its just nice to belong to a community like t2w.. I stay mainly to circumvent the boredom of waiting..

Anyway. If your new I think you should concentrate on one thing and not jump all over the map! just my 2 cents.. Please reply post or/email with your comments.
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Old Nov 23, 2006, 11:32pm   #2
 
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nice stealth ad


a bargain @ $ 280/month hahaha


snakeoil alert
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Old Nov 24, 2006, 2:33am   #3
 
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Smile levtrader

Quote:
Originally Posted by rwalkerx
Here are some reasons my colleagues and I prefer e-mins to stocks (off the top of my head)....

-Futures are always liquid enough. Market orders are instant
-The spreads are never going to be huge like they can get on stocks
-I have two accounts with about 20K in them. I can day trade without needing $25,000+
-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 (you can short on a down tick)


I started day trading again two years ago with stocks. I lost money pretty cosistantly..then I switched to e-mini YM.. at first I broke even for awhile (hey thats decent entertainment) then I joined a group of futures pros and watched for a month.. slowly but surely... I became able to trade on my own without chasing everything out there. Im still in that group but I can see signals on my own. Its just nice to belong to a community like t2w.. I stay mainly to circumvent the boredom of waiting..

Anyway. If your new I think you should concentrate on one thing and not jump all over the map! just my 2 cents.. Please reply post or/email with your comments.

I started day trading stock and is going good so far, however i am interested in trading mini futures, where can i get practical info on how to do it, do you recommend any books? or where the group of professionals that you talk about gather?
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Old Nov 24, 2006, 8:36am   #4
 
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Quote:
Originally Posted by rwalkerx
-Futures are always liquid enough. Market orders are instant
Can't say I've noticed a difference between a fill on liquid futures and liquid stocks. Of course there are illiquid stocks out there, but there are less liquid futures too.

Quote:
Originally Posted by rwalkerx
-The spreads are never going to be huge like they can get on stocks
Yes they are. Try trading one of the electronic agriculture markets out of regular US pit-trading hours. Or currencies around the time of a news release. Or the LIFFE sugar contract. Or...

Quote:
Originally Posted by rwalkerx
-I have two accounts with about 20K in them. I can day trade without needing $25,000+
Sure you get decent leverage, but so can you with stocks through spreadbets or CFDs

Quote:
Originally Posted by rwalkerx
-Focusing on one instrument day in and day out is less complicated and more productive
You can focus on one stock if you like - some people are specialists in Google, or Sandisk for example, which give enough daily volatility to profit from.

Quote:
Originally Posted by rwalkerx
-I can sleep in! As I dont have to wake up at 6am and scan for stocks to trade
One of stocks major advantages for me is the strict market hours. Most futures trade for the best part of 24-hrs. Waking up in the morning to see the money I made on a position trade has evaporated overnight, without having had the opportunity to trade out of it, is one of the big disadvantages of futures trading IMO. This is partly offset by not having big opening gaps, but I still find it more stressful to be going to bed when I know stuff is still trading than when I know a market is closed! Less relevant for day-traders admittedly.

Quote:
Originally Posted by rwalkerx
-Share size allocation is easier. I trade from 3-8 contracts depending on the setup
You'd have to be pretty poor at maths for this seriously to be an advantage.

Quote:
Originally Posted by rwalkerx
-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!
!!! Currency futures on NFP day !!! Oil futures after problems in the Middle East !!! Agri futures after a freak weather event !!! Are you joking??!!

Quote:
Originally Posted by rwalkerx
-There are always shorts avilable!
Not sure what the US rules are on CFDs and spreadbets, but certainly in the UK that's not a problem for stocks.

Quote:
Originally Posted by rwalkerx
-Comissions are reasonable (I pay around $4.10/round trip)
True.

Quote:
Originally Posted by rwalkerx
-No uptick rule (you can short on a down tick)
Again, a US issue, but not relevant for UK traders who can use CFDs / spreadbets.


Bottom line is that futures have some benefits, but the advantages aren't as one-sided as you make them sound, unless of course there was a reason for wanting to promote a futures trading service for beginners...
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Old Nov 26, 2006, 9:50pm   #5
 
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Good info re: e-minis.
What chart service do you use?
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Old Nov 27, 2006, 1:45am   #6
 
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I'll agree on the last point, as there's god knows how many ways to trade and work within the markets...but focusing on a couple and learning them to a T is the best way to be involved...
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Old Nov 28, 2006, 12:13am   #7
 
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Quote:
Originally Posted by MattF
I'll agree on the last point, as there's god knows how many ways to trade and work within the markets...but focusing on a couple and learning them to a T is the best way to be involved...
I use eSignal with 3 monitors and many 3minute charts
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