minimum allowable stops?

[JumpOff]

I'm looking into the variables that go with a scalping strategy. I think I understand what I'm up against for the spread and commission. I am interested in trading the e-mini indexes or possibly the mini euro. I haven't traded futures for about 15 years, and the last time I did it, my broker had a policy that required me to enter my stop loss a quite a distance from my opening position.

What's the situation like today? If you are trading on an electronic platform with a futures broker, does the system limit how close you place your stop to your opening or current position? I expect to be "in front of the screen" if I have a trade on and I expect to close most trades manually, but I'm wondering about a quick trip to the head, or a few steps to the kitchen for a coffee refill.
Thanks,
JO

P.S. Why would a broker care? The closer your stop, the more in_an_out for them. Oh to be a seller of picks and shovels during the gold rush.....

 

[Trader333]

If you use Interactive Brokers you can place a stop at any price that suits you or not at all.


Paul

 

[JumpOff]

Thanks Paul,
Some kids want to be a firefighter, pilot, doctor, or rock star. When I grow up I want to be an IB Client. My account size means I'll be starting with someone like tradestation sec. or Lind-waldock or such that accepts clients with smaller trading stakes.
JO

 

[a_gnome]

JumpOff
If you are trading the mini contracts then you don't need very much for an IB futures account.

Here's what I got from their web-site:

Australian Dollar (AUD) AUD 6,000
British Pound (GBP) GBP 1,450
Canadian (CAD) CAD 3,000
Euro (EUR) EUR 2,400
Hong Kong Dollars (HKD) HKD 15,600
Japanese Yen (JPY) JPY 250,000
Swiss Francs (CHF) CHF 3,600
U.S. Dollars (USD) USD 2,000

If you are daytrading US stocks then you will need the $25k minimum but this is an exchange-imposed restriction.

Hope this helps

 

[JumpOff]

Thanks,
I think I may gotten the wrong impression about IB from some posts I've been reading out of the archive. There current policies seem like I might be able to make their minimum. I have not heard one negative thing about them on these boards - which is an amazing thing when you think about it! Their commission structure certainly levels the playing field for a small indepent trader.

I have a feeling that it's not the bad trading that gets a lot of newbies (although lord knows there is plenty of that going on in my paper trading account ) , its might just be the slow nibbling away of your capital for each spread and commission.

JO

 

[a_gnome]

Thanks,
I think I may gotten the wrong impression about IB from some posts I've been reading out of the archive. There current policies seem like I might be able to make their minimum. I have not heard one negative thing about them on these boards - which is an amazing thing when you think about it! Their commission structure certainly levels the playing field for a small indepent trader.

Yes they are very good, I've know people who have been using them for years.

I have a feeling that it's not the bad trading that gets a lot of newbies (although lord knows there is plenty of that going on in my paper trading account ) , its might just be the slow nibbling away of your capital for each spread and commission.

JO

Having to make the spread and commission on each trade just to break even is a far bigger obstacle than most people imagine. You need to be making more than this amount ON AVERAGE just to tread water. Your average profit per trade includes all those nasty losers as well as those winners so the reality is that you need to have a good edge to start with.

A good starting point it to concentrate on making fewer trades of higher quality in order to overcome this cost-per-trade obstacle.

Hope this helps